Do You Have The Same Top 3 Retirement Worries?
If you think you are the only one losing sleep over retirement worries, think again. Most people nowadays have some anxiety about retirement. In fact, you are atypical if you are not worried about your retirement. Now, your individual worries may be different from someone else’s, but a worry is a worry. You may be concerned about paying off your debt or simply saving enough money to retire on. Whereas your co-workers are concerned about finding affordable healthcare during their retirement years. Regardless of the concerns, the best way to attack them is one by one. If you try to tackle all of your retirement worries at one time, chances are you will become overwhelmed and lose momentum in overcoming them. Let’s get you started by addressing 3 of the most common retirement worries that people have.
#1 – Outliving It
The absolute number one retirement worry is money. People are constantly asking themselves if they have enough money? Will my retirement savings be enough to live on? Will I have enough money to retire and then stay retired? Should I keep working and save more?
These are the questions everyone asks themselves about retirement. And the reason is obvious, people are worried that they will outlive their retirement savings. We all worry about running out of money. But there are ways to make more money if you are still in the workforce. Once you retire though, it’s not that easy to make more money, which makes the worry even more distressing. Imagine if you have been retired for 10 years and due to a miscalculation your savings are almost gone. What would you do? You are 10 years older, you have been out of the workforce for 10 years so your skills are a bit rusty plus the job market is tight. There you have it, the worry and possible consequences of outliving your retirement savings.
The Answer To Outliving It?
You have the answer to outliving your money, you know. Will social security be the answer? Umm, probably not. Everyone has issues with social security. In the end we all have the same worry about social security, and that is, will social security be a reliable source of retirement income? Why wait to find out. Just don’t include social security benefits as a source for retirement income when you do your retirement planning.
If you are serious about setting yourself up to live longer than your savings then start downsizing your spending, immediately. That may be obvious, but knowing it and doing it are two different actions. Most people understand that it is important to live on less than they earn and save the difference. But most people cannot seem to take the next step of actually doing it. It is really not that hard to downsize your spending. With some preplanning, you can do it little by little. One of the problems is that people think that if they cannot save huge amounts of money at one time, why bother. That is complete wrong. If that were the way to save money, no one would be doing it because most people do not come across huge amounts of money at one time. But most people do have areas of spending they can trim back and save the difference.
You know the obvious spending cutbacks, the café lattes, the lunches on the go, the appetizers and drinks at restaurants, the high-priced purses, shoes and other accessories. Okay, so you have that down pat, but what are your spending trigger points? Where do you overspend? Where do you always treat yourself, but shouldn’t? We all have those weak spending trigger points, find yours and trim it back. You will be surprised on how much extra money you find.
#2 – The Cost of Healthcare
Ahh, the cost of healthcare. This is a big retirement worry that you cannot escape from. This worry effects everyone. We all know that as we get older we will need more healthcare. And we all know that healthcare is expensive. The problem is paying for it. We also all know that the costs are higher for older folks because as we age we develop more health problems.
The Answer To The Cost of Healthcare
Unfortunately, part of your savings will have to pay for the cost of your healthcare. There is no way around it. Of course, there will be Medicare, but that will not cover everything. And you will still have to pay for the premiums, a deductible and the cost of medications. The only answer to the cost of healthcare is to earmark some of your savings so that you are not caught off guard if you are suddenly faced with a big bill. That is not an answer people like to hear, but it is a fact.
#3 – Where To Keep Your Money
The majority of us worry about where to invest. Should we invest in the stock market or safer investments like bank cd’s? Should we worry about safety or growth? If we want to increase our investment value, the stock market looks like a good idea. However, what if the market tanks and our portfolio tanks along with the market? Then what?
The Answer To Investment Worries
A good investment strategy is to balance out your investments. A good balance is to invest some money in the stock market for growth and to offset inflation and then some in safer investments such as money markets or bank cd’s. No one has a crystal ball on the direction of the stock market but with a balanced portfolio if the market goes up, you are all set. If the market plunges, you can rely upon your safer investments until the market rebounds again. You can always set up a back-up plan just in case. A financial back up plan to consider would be to put a portion of your retirement investments into an annuity. Annuities provide you with a guaranteed stream of income regardless of the market. Be sure to ask about fees and costs before investing in an annuity though, some annuities can be expensive. But at least research annuities as an option because they can be a reliable source of lifetime retirement income. And with the volatility of the markets, you need at least one reliable source of income.
Retirement Worries Continued
Whether it’s the cost of healthcare, the worry about outliving your money or where to put your money, you will always have retirement worries. And that’s okay as long as those worries do not drive you crazy. If your goal is to make it to the retirement finish line with enough money to keep going, then it’s up to you to get there. Just remember that no one cares about your retirement as much as you do. It’s up to you to get yourself there. You need to rely upon your own personal diligence to save enough money and make good investment decisions. Take the challenges one by one and don’t worry about making a few mistakes along the way. If you make a mistake, that’s okay, just get back up and keep going. It’s not about how far you fall, it’s about how high you bounce.