Retirement: Why You Need to Plan Now

You may not want to, but people of all ages need to start thinking and planning for retirement. What do you want to do with your time and freedom? Travel? Spend more time with family? Volunteer? Being financially prepared can make all the difference in what kind of retirement you will have.

Longer retirement, higher costs

The good news is that people are living longer, thanks to medical advances and increased awareness of health issues. Therefore, the length of retirement is lasting longer than ever. The bad news is that it is more expensive. In retirement, your costs will change-you'll probably spend less on work-related expenses, such as clothing and lunches, but your medical expenses will most likely rise. Inflation has to be considered as well.

Who will cover the cost?

Imagine what life will be like without your paycheck. You may receive other sources of income from some or all of the following:

· Social Security. This isn't intended to be the only source of income for retirees. It was created to supplement your income.
· Pension. This is also meant to supplement other sources of income.
· Inheritance. If you expect an inheritance, plan carefully to ensure that it will still be around to provide income when you retire.
· Retirement Savings Plan. The money you save and the choice of investments will have a huge impact on the return.
· Personal Savings. Save as much as you can now. Look into an individual retirement account (IRA)

Preparing for retirement will only be a benefit to you and your family. To make sure you're on track for a comfortable retirement, get your finances in order now. That means paying off debt, save, and invest.