What To Consider When Preparing For Retirement
Many people look forward to their retirement days when they can enjoy the pleasures of retired life. But they have not yet realized the importance of planning for their retired life and preparing themselves financially for it. It is very necessary to take stock of all your available finances. Your current financial position needs to be established and you also need to decide how much money you will need for your retired life and how you are going to go about raising the money should also be established. If you have many debts, which need to be repaid, then you are not financially ready for your retired life. If your present standard of living has to be continued even after you retire, then you should have at least 70-90% of your current income at the time of your retirement.
The perception of retirement is different for each person. For many people, retirement means sitting on a wicker chair in the porch and watching your grandchildren play. Many people feel retirement will give them the time and the freedom to travel all over the world. But this kind of world tour is also a very expensive venture and it involves a lot of money. Many people feel that retirement comes is a middle path, which comes in the middle of these two fences. Once all your expectations from your retirement are understood then you will be able to plan your retired life in a better manner.
A good and healthy lifestyle today will ensure a healthy and safer retirement in the future
Your working life is the right time to stay healthy and give up all the vices like smoking and drinking. People who do not take care of their health and their finances properly during their youth and their career lives, will suffer the consequences in the future when they have severe health problems and they have to think twice before spending every penny. There are many companies which offer retirement plans for their employees and people should make sure that they gain a complete understanding of all these retirement plans during the course of their employment. Make sure that you find out how much your employer is contributing towards your retirement fund every month and what is the amount, which is contributed by you from your salary.
Discuss your retirement plans with your spouse
Understand all the details about the benefits, which you will receive at the time of your retirement. Read all the concerned documents and forms carefully before signing them. A statement of the amount in your retirement fund should be made available on a regular basis so that you will know exactly how much you have ready for your retired life. All these statements should be recorded in a methodical manner.
It is a very good idea to open a TFSA and almost all Canadians do this. Once you have a TFSA opened, make sure that you contribute the maximum possible amount towards the account every year. As you are getting close to retirement, you need to discuss your future with your spouse and to make sure that both your plans run parallel to each other. Your family should also be made aware of your plans and what is the impact that it will have on them.
Decide how you are going to spend your time after retirement
Once you retire you will find that you have so much time on your hands and you do not know how to go about using it constructively. Find out whether life insurance has been included in your plan and if yes then make sure that you understand all the benefits of this plan. The benefits of a life insurance policy will be very useful to your family specially if there will be a lot of debts left unpaid when you die and no source of regular income when you die. Also find out all the details about medical insurance. Many people find it difficult to contemplate a major illness, which will completely consume all their savings. But they do not realize that the possibilities of ill health increase dramatically as age increases and hence it is much safer to have a medical insurance policy readily available.