3 Simple Tips for your Retirement Plan

raaman

Valued Contributor
3 Simple Tips for your Retirement Plan.

Retirement does not mean just sitting at home reading all the newspapers, and relaxing. When you plan well in time, it is the best part of your life.
Here are three tips for your retirement plan.

1. You have to plan for your retirement in time:

You should begin as soon as possible to reap the benefits of compounding, so that even a small amount of money will increase and become significant in due course.

2. Commitment:

Discipline is required for any retirement planning. Regardless of your day to day expenses, you should provide regular funding for your goal until you retire.

3. Change:

Prices of all things will continue to rise until you retire, and prices will continue to rise even after you retire. Therefore, you have to keep computing inflation. It is because the inflation will affect you for as long as you live, and your living conditions may change.
 

Jasz

VIP Contributor
It's right to say retirement planning is a process, not a destination. It takes time and effort to develop a comprehensive plan that meets your needs, but it can be done.

Important tips on retirement planning:

1. Determine your income needs. This might be more than you think, especially if you have health issues or want to start a family.

2. Create an asset allocation plan that includes both stocks and bonds. You can change this after you retire, but it's important to start with something that fits your risk tolerance, so you don't end up in trouble later on.

3. Create an emergency fund and make sure it's adequate for at least six months' worth of living expenses. This can help in case of financial emergencies such as job loss or medical expenses during retirement.

4. Set up a Roth IRA or 401(k) if you're over 50 years old and have earned less than $100,000 in income over your career (not including employer contributions). Contributions are tax-free if certain conditions are met (such as earning under $110,000). The contribution limit for those under 50 is $5,500 for 2018; for those 50-64 years old it's $6,500 per year.
 
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