Most Baby Boomers are getting ready to retire if they haven’t already. If this describes you, it’s not too late to make some key changes that can help you protect your future finances! Now is the time to develop good habits that can help cement a secure plan for your upcoming decades of retirement. If you’re between the ages of 50 and 70, here are 7 helpful things you can do right now to save for later.
Trade in the luxury vehicle
If you’re currently driving to impress with a luxury vehicle, you may be surprised at the yearly savings you can acquire simply by ditching it for a standard model car. Between insurance, maintenance, car payments and gas you can save upwards of $4,000 a year over the life of a car simply by purchasing a Honda over a Volvo. According to gobankingrates.com, if you invest that $4,000 every year in a balanced index fund that earns 7 percent annually, the savings would be worth $184,296 after 20 years! Just by changing your car!
Downsize Your Home
Sure, the large home and big backyard were nice while you were raising children, but if you’re still holding on to your family home, and your children are adults, or on their way out of the nest…you’re probably realizing it’s a lot of extra space and maintenance! That also means you are paying for that extra space and maintenance. Even if your home is paid off, property taxes, maintenance and insurance never go away. It’s wise to downsize to a smaller home, condo or apartment, and take the savings and invest in an IRA, Roth IRA, 401k or savings account which is specifically designated for your retirement.
Get in the habit of paying cash for everything, as well as taking a percentage of your income each month and paying off personal debt until it is gone. Not being in debt to others is an important step in being self sufficient and saving for the future.
Many people can’t resist a good bargain, but if you don’t need an item to begin with, it doesn’t matter if the price is right! You’re still spending unnecessarily. A bargain isn’t a good deal if you already have it, won’t use it, or don’t need it. Discipline yourself to making necessary purchases and resisting shopping as a “hobby”.
Focus on Your Health
People don’t typically associate good health with saving money, but if you have habits like smoking or drinking alcohol, cutting them out of your life can add hundreds of dollars to your monthly budget. Not to mention, taking care of your health today will lessen the number of doctor’s appointments, lab fees, co pays and hospital stays in the future. Eating clean, such as adding more fruit, vegetables and lean meats to your diet can actually save on your grocery budget, especially if you tend to buy a lot of processed food or eat out more than you should.
For more tips on how to save money for retirement, visit gobankingrates.com