Your retirement might be tomorrow, or it might be years from now. Regardless of when you are supposed to leave the workforce, you are probably fraught with worry about what you are going to do monetarily throughout your golden years – after all, no one dreams of being a Wal-Mart greeter. However, are you worrying about the right things, or things that you shouldn’t be worrying about at all?
Worry #1: Will Social Security Be There?
No one really knows, but worrying about it won’t change a thing. Instead of concerning yourself with the viability of a system you paid in to that may (or may not) go bankrupt, plan for the worst, but have a contingency. Where most Americans fail is by failing to plan for passive income strategies by investing in real estate, business startups or other vehicles that will provide them guaranteed income throughout their golden years.
Worry #2: Can I Get the Kids Through College?
Sure, you want Junior to get a great education, but that doesn’t mean you need to worry about clearing your 401k to fund it for him. College educations come with payment plans, your retirement does not. Focus on saving for your retirement, and allow your child to launch on his or her own. They will be better off for it.
Worry #3: What About My Debt?
The sooner you pay your debt off (or down), the better. Heading in to retirement with a mountain of debt is never a good idea. Instead, focus on paying off your debt pre-retirement, maintaining a solid term life insurance policy and planning for your estate with a will, naming executors (and planning for contingencies).
Worry #4: Should I Use My Stocks?
You could cash out your stocks now or cash out your stocks later, but the result will be the same. Consider investing in a Roth IRA or traditional IRA so you avoid the hefty tax penalties associated with cashing out your stocks now, or the even higher penalties associated with cashing out your stocks later – thanks, inflation. Instead, consider real estate investments or investing in a franchise to keep your taxes low and your returns high.
Worry #5: Will I Be Able to Make My Mortgage?
Instead of sweating whether or not you can make your mortgage payment post retirement, plan like this: Look at your current income, subtract 30 percent from that, and ask yourself if you can comfortably make your payments. If you are over 50 and the answer is now, it’s time to downsize to a payment you are comfortable with now, as opposed to later.
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