Catching Up: 3 Retirement Strategies For Those With A Late Start
Posted on: 25 April 2017
Nowadays, 50% of Americans retire between the ages of 61 and 65. To achieve this, most Americans have retirement plans in place that will ensure that they will still be financially afloat even after they decide to quit the workforce. If you haven't put much thought into retirement until now, you might feel that you're behind on the game. This article looks at 3 retirement strategies that are perfect for those who have a late start.
Understand the Various Catch-Up Contributions You Can Make
The government understands that not everyone planned ahead and is ready for retirement. Due to this reason, many investment portfolios and savings accounts allow for older participants to make catch-up contributions that will get them up to speed. For example, workers who are over 50 can make an additional contribution of $6,000 on top of the regular limit of $18,000 to their 401(k) plan.
Take a Look at Riskier Investment Opportunities like Stocks
If you're starting to plan for retirement at a later age, you might need to save up a lot more before you'll reach an amount that you feel confident that you can live off of. To get there, a financial advisor might advise that you consider some of the more riskier investment opportunities that are available. This include stocks that are expected to provide a higher rate of return. A financial advisor can help you weigh the pros and cons to determine whether it's worth taking on higher risk in order to potentially achieve the results you desire.
Seek Alternate Income Streams that Suit Your Lifestyle
With not much time left before you'll retire, it's vital that you design a spreadsheet that clearly shows the type of expenses that you can expect to have after retirement. Your financial advisor, like those at Wealth Mechanix, will take a look at the assets that you have saved up to determine whether there are alternate income streams that might suit your lifestyle.
For example, instead of letting money sit in a savings account, they might recommend that you invest in real estate or mutual funds. Not only will your property likely grow in value, but you can also rent the place out and earn a steady stream of passive income even after you retire.
Conclusion
Even if you're late to the game, don't fret. Talk to a financial advisor. Upon reviewing your financial statement and situation, a financial advisor can provide you with unique retirement strategies that are tailored to your lifestyle and situation.
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