How to Plan for Retirement
Retirement can be a scary thing. When you’re young and starting your first job, you don’t want to think about retirement. You’re getting your first paychecks and want to spend it on the things you want to spend it on. As you get older, you realize maybe you should’ve started planning at a young age so you wouldn’t have had to worry about it later down the line. Regardless of why you may want to plan, learning how to plan for retirement can help everyone be prepared.
TFC Title Loans believes in helping their customers with all their financial needs. We want their lives to be as stress free and enjoyable as possible. If you’re worried about retirement, then we’ve got your answers here. Doing business in Car Title Loans since 1994, we’ve come up with different financial ways to save money for retirement.
When to Start
It’s never too late to start planning for retirement. Most of the time, jobs will set you up to automatically have a 401K established, or you have the option to establish one. If your company doesn’t have a 401K, they’ll most likely have a pension plan. In today’s economy, you can start saving right out of college with your first job.
If you don’t have any of those plans or you never received one, then there are many ways to save. You’re never too old to start, and you’re never too young. All of these ways below will help you save your money for retirement, regardless of age.
Estimate Your Needs
In order to calculate how much money you’ll need for retirement, you’ll need to calculate what types of things you’ll have in the future. To live an average life, most people need 70% of their annual income to live comfortably. If you plan to live out your dreams and travel as an elderly, you’ll probably need 100% of your income. Once you figure out what you’re going to need, you’ll be able to compare that to what type of retirement fund you’ll have. Then, you’ll know if you’ll need to find other methods of saving outside your 401K, pension/annuity plans, and social security.
Calculate What You’ll Have
After you’ve figured out how much you’ll need, think about how much you’ll have. If you have a 401K plan with your company, it’s highly suggested you take advantage of it. If your company uses a traditional pension plan, find out how much your individual benefits are. As you change jobs, if you do, find out what happens to your pension plan. Also, see if your spouse has a plan and if you’re entitled to benefits from them.
In order to calculate your Social Security Benefits, you can go online to calculate the estimates based on expected earnings.
Other Sources of Money
If you feel like what you’re estimated to receive for retirement is not enough, there are other ways you can save money so that you’re prepared.
Individual Retirement Account (IRA)
Putting money into one of these accounts can help you save. You can put up to $5,500 a year into an IRA, and you can contribute even more if you are 50 or older.
Investing long-term into the stock market has been a good way to save money. Even during the 2008 recession, the market averaged an 11% rate of return. Using online tools to help you can definitely benefit in your investments.
You can invest your money into objects other than the stock market. Investing into small companies or newer inventions can help you gain money in the end. Make sure you are doing your research on the new up-and-coming technology, focusing on consumable products. Avoid things like cash-value life insurance, individual stocks, gold, silver, and precious metals, annuities, or low-interest-yielding investments.
Another investment you can make is in yourself. Start an automatic deduction from your pay each month. Start low and you can eventually work your way up. You want to start a safety net first, then work on your retirement savings bucket.
Compound Interest & Savings
As a young adult, starting early could be one of the best decisions for retirement planning. Thanks to the power of compound interest, young people are given an opportunity to become truly wealthy. For example, you have saved $15,000 by the time you are 25. With a return rate of 12%, you will have over $1 million by the time you are 65.
Car Title Loans with TFC
If you’re eager to get started on your saving, an auto title loan could be the answer for you. You may not have the money right now, but TFC could get you quick cash in as a little as one business day. By using the equity value of your vehicle as collateral, we base your loan off the value of your car. The best part is: you can still drive it as you pay! Fill out an application today to see if you qualify for an auto title loan.