Trim Debt|Start Retirement Lean & Mean
Yes it’s possible to financially survive retirement if you are in debt; but do you really want to? There’s nothing good about debt. It wastes money and infringes upon your ability to enjoy your retirement years; is that what you want?
Retirement is supposed to be the best time of your life. You are free from the stress of the workplace; your time is your own; you are free from all burdens.
If you enter retirement overburdened by debt, your retirement will be a struggle. The high cost of your debt will burn a hole in your retirement plans. If you want to truly enjoy your retirement years be lean and mean before you start your retirement by slashing your debt.
2 Retirement Obstacles
1) Retirement income is typically less than earned income was during your working years.
- Social security payouts may be minimal.
- Retirement plan payouts are only as good as you built the retirement plan account up to be during your working years. If you invested a little, you will receive a little…small amount in, small amount out.
2) You shift from semi-guaranteed unlimited paycheck income to limited retirement income.
Avoid Retirement Obstacles
You can run into financial trouble if you quit working and your retirement income is not enough to support you plus pay down any debt you bring with you. You may be better off delaying your retirement until you have whittled down your debt.
If your debt load is large but you are forced to retire due to circumstances beyond your control, such as health issues or company downsizing, try to delay dipping into your retirement investments as long as you possible can by making some changes.
Tweak Your Lifestyle
Force yourself to live on less than your retirement income.
- Downsize your needs and wants.
- Stop spending to avoid accumulating more debt.
- Pay down the debt with the smallest balance first.
- Next pay down the debt which has the highest interest rates and is costing you the most.
- Downsize your home; buy a smaller home or a condominium. If you have to get a new mortgage and accumulate new debt, this may not be a good move.
- Find part-time work to help pay down your debt.
- Sell one of your cars. If available, use public transportation.
- Move to a cheaper part of the country.
- Cut out the frills; cable tv, gym membership, cafe lattes are the most common and can be the biggest waste of money in some cases.
It’s A Judgement Call
We all want the absolute best and most expensive; but that doesn’t mean it’s what we need. Take a step back, be honest with yourself; determine your real wants vs needs. Determine if your wants are too expensive and could they be putting you into debt; which is delaying your retirement?