6 Goals To Have For Your Finances Before Retirement

6 Goals To Have For Your Finances Before Retirement

May 17, 2022

Retiring from work? Congratulations! But before you tick off your retirement bucket list, you need to tick off your retirement to-do list. 

If there’s one thing this year has taught us, it’s that things can change quickly. Putting money away when you don’t have any immediate need for it can be a little difficult. With this in mind, we urge you to think a little into the future. 

Setting financial goals is a big step towards becoming financially secure before and in retirement. Whether it's setting short-term, midterm, or long-term financial goals, you'll be working towards something specific for your individual needs and circumstances. Financial goals are savings, investment or spending targets you hope to achieve over a set period of time. The stage of life you’re in usually determines what type of goals you wish to achieve.

Here are 6 goals to have for your finances before you reach retirement.

1. Crunch Those Numbers

Before you retire, you should take the time to understand how much you’ll need in retirement and how your accounts will provide income. Budgeting may not be the most fun, but it can help you spend less than you earn. With a budget, you can successfully account for where your money is going and start thinking about where you can begin saving. Start by categorizing your spending. 

For example, you could create budget categories for food, rent, savings, nights out on the town, Netflix, and so on. Next, look at your total monthly income and expenses. Using your after-tax income, allot a certain amount of money to different categories in your budget. There are many apps out on the market that automate your budgeting for you, but you should also consider consulting with a financial planner to help you plan how much you’ll need, how much you currently have saved, and how to fill in any gaps. You will also want to take the time to estimate your expenses in retirement to confirm you have the income to cover them.

2. Put Your Savings Strategy on Auto-Pilot

Bigger is better when it comes to your savings account. While saving can seem hard, automating your savings will make it significantly easier. By setting up automatic transfers to your savings account from your checking account, you can put your savings strategy on auto-pilot and you’ll hardly even notice the money is gone. 

Start by automatically saving 10% of your income with each paycheck. You can typically set up automatic transfers online or by talking to your bank. Automating your savings can make the process easier and help you build wealth effortlessly.

3. Get Up to Speed on Insurance

Make this a top priority as you’re planning to retire so you don’t spend any time uninsured. Your options depend on your age, but the most common types include:

  • Life Insurance: The greatest benefits of life insurance include the ability to cover your funeral expenses and provide for those you leave behind. 
  • Health Insurance: If you don't have health insurance through an employer, check with trade organizations or associations about possible group health coverage. 
  • Long-Term Care Insurance: Here’s the good news: our life expectancies are longer than ever. But that means we’re likelier than ever to need some sort of long-term care during our lifetimes.
  • Long-Term Disability Insurance: A policy that guarantees income replacement is optimal. More often policies pay out between 40% to 70% of your income. The cost of disability insurance is based on many factors, including age, lifestyle, and health. 
  • Auto Insurance: To make sure you get the right insurance for you, compare several rate quotes and the coverage provided, and check periodically to see if you qualify for lower rates based on your age, driving record, or the area where you live. 
  • Travel Insurance: After all, what is retirement if you can't enjoy some trips away? 

4. Self-Care Security

Want to know one of the best things to invest in? Yourself. It may bring returns on your happiness, success and even salary. Think about what new skills could beef up your resume, and look for learning opportunities in your community or online that could help you move your career forward.

Not only that, think about what you want to accomplish in the future. Think about the things you;ve always wanted to pursue but didn't have the time to do. Perhaps it's going back to school to get your MBA, or you're looking to learn a new trade such as coding. You can easily look into resources and classes on LinkedIn or take up a Masterclass. By investing in yourself, you can become more well-rounded.

What's most important is your health. So focusing on eating well and moving your body daily is essential to enjoying your golden years to their fullest.

5. Keep Growing Your Money

A secret weapon to jump-start your retirement is time. The magic of compounding interest can turn just a little bit of savings into a large nest egg. Strive for saving 10% to 15% for retirement through your employer-sponsored 401(k). If you’re eligible, make sure you contribute enough to get a company match, at least! It’s free money and a sweet job perk. Also, consider getting extra tax benefits by contributing to a Traditional or Roth IRA.

If you work for yourself, you might want to check out retirement plans for self-employed people. Options like a SEP-IRA can help you save for retirement on a tax-deferred basis, just like employees on company plans.

Just remember, after you’ve retired, your retirement income plan may include two sources:

Guaranteed income sources.

  • Social Security, if you’re taking it now
  • Pensions (traditional defined benefit plan)
  • Annuities

Assets to fund retirement.

  • Individual retirement accounts (IRAs) and retirement plans (401(k), 403(b), ESOP)
  • Personal savings (CDs, bank and money market accounts)
  • Investments (stocks, bonds, mutual funds, real estate)
  • Wages in retirement (example: part-time job)

6. Sit Down with Your Financial Advisor

Still not sure where to start on your financial strategy? Consider sitting down with a financial advisor. By taking a look at your entire financial situation, they can help you establish a customized plan designed to meet your short- and long-term goals. Then, your financial advisor can help you select suitable products and services designed to put your plan into action. 

At Agemy Financial Strategies, our firm exists for the purpose of helping people achieve their personal and financial goals. Our philosophy is to deliver quality financial programs and teach principles for successful living. We work hard to deliver a dependable retirement income strategy, in any market, so that you can enjoy the “best” of your lives during retirement.

Final Thoughts

The best thing about setting goals and financial planning is you can review and update your goals and monitor your progress in reaching them. In the process, you will find that both the small things you do on a daily and monthly basis and the bigger things you do every year and over the decades will help you achieve your financial goals.

We want you to know we’re here to help you navigate retirement and any questions that come up during your retirement process. As Fiduciary advisors, it's our duty to act on your behalf in finding the right solutions for your individual wants and needs. 

For more information on our retirement and financial planning services, contact us here today.