I am always open to thoughts on how to best use my savings to grow themselves and I’m sure you are the same so when I read & heard this
Retirement: 5 tips on how to save $1 million
I was all ears! We are all living longer but we still want to maintain our own personal standard of living, as well as being prepared for any future health care costs. This is how to be like a good scout and “Be Prepared”
Five tips for saving a cool million by the time you retire.
Start early and take advantage of the power of compounding. It only makes sense too make use of free money
Have a plan It really focuses you.
Take advantage of your company-sponsored savings plan Again the free money advantage. Jeanne Thompson, vice president at Fidelity Investments, says: “90% of the Fidelity millionaires are taking advantage of the catch-up provisions and many are saving up to the maximum. “They are milking it for all it’s worth.””
Use automatic deductions for all your savings. If you stick a certain amount on a regular stop order deduction you can’t be tempted to spend it 🙂
The stock market is your friend. “You won’t get there just on savings alone,” says Thompson. “It does take some market action.”
“I think it’s a worldwide phenomenon that people tend to only look at their financial affairs when they’re in dire straits or when there’s a significant life event that forces them to do so…” says PETER HEWETT MD, Efficient Group SA
If that is so how do we stop ourselves becoming a statistic? When should we start our financial planning?
We all know in theory we should have started saving with our first pay cheque – but life has a habit of getting in the way and we don’t always keep to the Grand Plan…
So what should I have in place as I roll towards retirement?
An Emergency Fund – it should normally be around three months of your monthly income, to ensure that you can cater for those sudden unexpected short-term emergencies,
Make an Investment Plan – Create an investment plan so you have a disciplined approach to investing throughout retirement (Tick)
A Retirement Budget – You must come up with an accurate estimate of what you spend now and what will change after retirement. (Tick)
Health Insurance Options – How to cover medical expenses and health insurance and included them in your budget? (Tick)
Make a Retirement Income Timeline – Make a retirement income timeline to show when different sources of income will begin matched against potential retirement expenses (Tick)
Well I’m on the right track – how about you?
I just need to keep to it now … watch this space I guess 🙂