Many people talk about looking forward to retirement because it means they don’t have to worry about anything anymore, but unfortunately, things are not always that simple. You can have a relaxing and enjoyable retirement but only if you are smart about your finances leading up to it.
Saving for retirement is especially important if you plan on living in a retirement community or some other senior living situation. While these communities have many benefits, they do come at a cost.
So it’s important to sit down and do some retirement planning. Even if you’re already retired, the guidance in this article can help to ensure you have a more enjoyable retirement as you age.
It is possible to live the carefree retirement you so desire, but you’ve got to earn it. In other words, if you want to be comfortable financially and afford a cozy retirement life, you have to be willing to plan and save up.
Whether you are already in retirement or inching ever closer to it, learning how to budget to make the most out of your money can be a lifesaver. If you’re not yet in retirement, you can start budgeting to cut costs wherever possible and then put that money you would have otherwise spent into a retirement savings account.
If you are already retired, creating a budget can help you better understand how much money you have to spend in retirement and how best to use it. This includes budgeting for food, shopping, or any travel or entertainment activities you want to explore.
Not many people think about this, but the state you live in can affect your retirement savings. This is because some states tax retirement income and others do not.
As of 2023, the following states do NOT tax retirement income:
Several states don’t tax pensions or social security. If it’s an option, you may want to consider moving to get the most out of your retirement.
Of course, if you’re looking for a way to earn a little extra money to put toward retirement, you could always turn a passion project into a source of income.
You could turn your interest in art into a side hustle, for example, and sell your work online or at local markets and art fairs. You could even turn your love for baking into a home business. If you already enjoy making sweet treats, you likely already have much of what you would need to turn into a source of income to use for savings. You may want to purchase separate baking supplies for your home business to keep those expenses separate from your finances.
You will also need to research your local laws and regulations for operating a business out of your home and obtain the proper permits. It’s also a good idea to get business insurance if the operation gets large enough.
Estate planning is also important if you want to prepare yourself for retirement and the unexpected life events that could come with it. Having a trust, for example, and your living will all be planned out ahead of time will allow you to relax easier come retirement. Waiting until the last minute to get these things in order can be overwhelming and can put you or your loved ones in a tight spot.
If you are struggling to manage your finances as you prepare for retirement on your own, don’t be afraid to reach out to someone for help. There is likely a family member that can help you manage your finances. If not, you can look into getting help from a power of attorney who can assist you in finding someone to handle your financial matters.
When it comes time to pay for senior living or a retirement community, there are a few different options to consider. Despite what you might think, Social Security will likely not be enough to cover your senior living expenses. Additionally, it’s worth noting that Medicare does not pay for the cost of living in a retirement community. Medicare can help pay for certain services you might need, but it will not pay for the cost of actually living in a senior living community.
But there are other options that you can look into to find the funds you need to pay for retirement living, including:
It’s never too early to start planning for your retirement. The more planning and preparations you do, the better. This is especially true if you plan to live in a costly retirement community. And don’t be afraid to reach out for help if you need it. There are plenty of resources on the Internet today that can help, or you can even consult with a retirement-focused financial planner, as mentioned above.
Sam Bowman writes about people, aging, wellness, and how they merge. He enjoys getting to utilize the internet for community without actually having to leave his house. In his spare time he likes running, reading, and combining the two in a run to his local bookstore.
