We all confront different financial decisions at various points in our lives. At some times we might be focused on solving certain problems, while at other times we set goals to attain. Whatever your short-term priorities are at any age, it is important to view your finances from a long-term perspective.
In your 20s, it is normal to focus on very short-term goals. But don’t overlook the power of time! Investing even a little bit of money from each paycheck will pay off in a very big way at retirement, due to the time that money has to accrue interest.
In your 30s, you might be feeling more comfortable with your income, and you might be hitting milestones such as home ownership. But just because you’re more comfortable now, don’t overlook your long-term plan. Savings should increase with your salary! You should also think about options like life insurance and saving for your children’s college expenses. Making more money shouldn’t simply translate into more vacations and nicer furniture.
Most of you reading this article have said goodbye to your 20s and 30s, but the above lessons are good ones to teach to your children. If you’re looking back and realizing you didn’t plan as well as you should have, the good news is that you still have time to prepare for retirement.
In your 40s and 50s, you will probably hit the peak of your career. Now your earnings are higher than ever, and you can make significant progress toward your retirement savings goal. Once you reach age 50, you can make additional catch-up contributions to your retirement plan, and reap all of the tax benefits of regular contributions.
Now is the time to consider your retirement expenses, and adjust your savings goal (and perhaps even change your expected retirement date). Have you thought about the cost of health care in retirement? If you plan to retire before age 65 (the age of Medicare eligibility), how will you cover your medical bills? Once you are eligible for Medicare, how will you pay for out-of-pocket expenses (which rise a bit each year, due to the rising cost of health care)? What about the cost of long-term nursing care? As you evaluate your expected retirement budget, remember we offer different types of insurance to help you manage your expenses.
In your 60s, you’re headed for the finish line. This is the time to make decisions like when to claim your Social Security benefits, and whether to change the way you invest your savings. Working with experienced professionals who can guide you through these decisions can make a big difference in your satisfaction in retirement.
Remember, we’re just a phone call away if you have questions about the many types of insurance you should be considering right now. Call us for an appointment, and we can help you decide which options are right for you.