Throughout life, there are many different financial phases and stages that someone goes through. From opening your first savings account to buying your first house, and so on. It is important to build your financial structure over time, to ensure the best possible financial stability as you embark on a lifelong journey. Here are a few simple money tips to follow before and after your retire.
Open a Savings Account
The first savings account you open independently is an important part of your quest to build financial stability, and a retirement plan that will keep you comfortable. Start with your preferred banking institution, and sit down with a personal banker. Find out what type of savings accounts your bank offers, if there are any fees or perks, and do your best to contribute to it every paycheck.
Pay Down Your Debt
Outstanding debt is a major issue for many American adults. Student loans, mortgages, credit cards, and car loans are all components of consumer or household debt. In fact, by 2018, Americans accumulated a new record of $13 trillion in debt. It is important, and wildly beneficial, to start tackling outstanding debt as soon as possible. Establish payment plans for your student loans, and work on paying off credit card debt.
Consider Your Budget When Buying Your First House
Buying your first home can be very exciting; however, it can also be extremely expensive. Always consider your budget when house hunting. Think about and understand what you can afford, while still being able to live comfortably, rather than what you want to afford. Take time to do the required research on loans, mortgages, and lenders; a first home can often come with renovations, you will want to have some money set aside for this as well.
Invest In Retirement
Though it could be years away, it is essential to your future retirement to start planning as soon as possible. Take a look into 401K plans that your company may offer, if they match or not, and if so, how much. If your company doesn’t offer a 401K, take a look into some independent options, like an individual 401K or an IRA (Individual Retirement Account).
Know Your Budget
While you will have resources like social security, and the retirement plans that you contributed to over the years, it’s important to understand your budget after you retire. Not having a flowing steady income that you may be used to, can sometimes make understanding what your budget is a little more difficult. After you retire, take a look at the money you are still collecting, and your expenses; and don’t forget, part-time work is always available to stay busy and still collect an income.
The idea of downsizing can be frightening, depending on what you’re used to. First, try not to look at it in a negative light. Downsizing can be a great way to enjoy retirement and cut down some living expenses. Not only can you potentially save on your living expenses, but also reduce upkeep, home maintenance, and taxes.