Regardless of how close you are to retirement age, it’s never too late to implement new money-saving strategies. The following tips may help improve your savings account for the long run.
Crank up savings
Depending on how far away retirement is, it can be a challenge to pinpoint the right amount to save each month.
Ideally, employees and employers alike should aim to redirect about 15% toward retirement contributions.
When automatic enrollment deductions hover around 3%, the 15% recommendation might come as a surprise goal.
At the very least, workers should aim to contribute as much as the company is willing to match. This maximizes every dollar saved.
Over time, these savings will add up substantially. So it’s important to build new savings habits now, with the goal of increasing contributions as time passes.
Individuals nearing retirement might consider additional years of service in the workforce to make up some ground.
An extra year or two on the job will create more financial wiggle room because it allows for assets to grow longer and lightens the financial lift on savings once you begin to pull from retirements funds.
Remember, the more time you have to save, the more time your assets have to grow. This is always a plus.
Hold off on claiming Social Security
A delay on claiming Social Security will boost monthly entitlements.
When workers wait for full retirement age, which is around 66 years of age, they’ll earn greater monthly payments. Benefits will also increase for holding out each year through the age of 70.
So, if you were eligible to retire at 62, but wait until you’re 70, then theoretically, you may expect the return to be 77% more.
Find a way to invest in IRA
Not every employer will offer an IRA savings account. But that doesn’t mean you should lose out on an opportunity to save.
As long as you or your spouse are working, you’re eligible to open an individual retirement account and begin saving.
Depending on where you are, the untaxed dollars that go into retirement savings can earn handsome returns through compound growth.
Just keep in mind that there are limits as to how much of a contribution you can make toward this account.
Consider Home Equity Conversion Mortgage
If you’re near retirement, then you probably qualify for this mortgage option.
Imagine as a new retiree having the ability to immediately boosting your buying power. It’s possible with this loan program.
A Home Equity Conversion Mortgage usually requires a 50% commitment and in return, the borrower will no longer make monthly payments as residents of the home and enjoy new financial freedom.
Please contact us today to learn more about this opportunity to boost your income, eliminate the mortgage payment and make good on your much-deserved retirement plan.
*(1) at the conclusion of a reverse mortgage, the borrower must repay the loan and may have to sell the home or repay the loan from other proceeds; (2) charges will be assessed with the loan, including an origination fee, closing costs, mortgage insurance premiums and servicing fees; (3) the loan balance grows over time and interest is charged on the outstanding balance; (4) the borrower remains responsible for property taxes, hazard insurance and home maintenance, and failure to pay these amounts may result in the loss of the home; and (5) interest on a reverse mortgage is not tax deductible until the borrower makes partial or full repayment. This material is not from HUD or FHA and has not been approved by HUD or any government agency.