Many people can’t wait until the day arrives when they can step back from their professional careers and finally start living their life in retirement. Yet, far too many individuals start nearing their target retirement age only to discover that they aren’t as prepared as they had hoped.
This forces them to stay in the workforce longer than they wanted. The Texas retirement planning experts here at Sabine Financial want to help you prevent this from happening, so no matter where you are in your retirement journey, use these helpful insights to ensure you can retire on your own terms.
How to start planning for retirement today.
Understand how much money you’ll need in retirement.
This is the first step for anyone who’s ready to start their retirement planning in Texas. This amount won’t be the same for everyone, because everybody has unique financial situations and retirement goals.
There are plenty of helpful retirement calculators that’ll help you determine what your goal dollar amount should be, but you must keep certain factors in mind when using them. Things like the type of lifestyle that you want, whether or not you’ll downsize your home, and how you’ll pay for medical expenses all factor into the final dollar amount you’ll need.
Start saving as early as possible.
Regardless of what age you are or when you plan on retiring, the best time to start saving is today. The earlier you start, the longer your investments will have to grow. So if you don’t already have a retirement account, now’s the time to get one. If your current employer offers a 401K, put any discretionary income into it whenever you can. This is especially true if your employer matches some or all of your contributions, because that’s essentially free money for your retirement.
If you don’t have an employer-sponsored 401K or want to supplement it, you can also open up an individual retirement account (IRA). You’ll have to choose between a traditional IRA or a Roth IRA, but if you’re not sure which is best for you, our Texas retirement planning experts can help you.
Understand what your risk tolerance should be at varying stages of life.
One significant drawback of these types of investment accounts is that they are tied to the market. So if you’re ready to retire but the market suddenly takes a dip, you’ll lose the savings you thought you had stored away for this next chapter of your life. One way to avoid this is by understanding the risk strategy you have with your portfolio.
If you’re starting at a young age, it’s OK to have one that’s invested in riskier stocks and bonds. These investments can end up being quite lucrative, but if they fall, you’ll have time to recoup the money later in life. The older you get, though, the more you should consider diversifying your portfolio with lower-risk investments, so you are protected from market dips.
Are you ready to start planning for your retirement?
The professional Texas retirement planning experts at Sabine Financial are ready to help. As a boutique financial consulting firm, we have years of proven experience helping local residents create a strategy that allows them to thrive in retirement rather than just survive it. When you choose to partner with us, you can have confidence knowing you have a partner for every step of your journey.
That’s because we view our partnership as a collaborative relationship where we are here to provide the expertise and insights you need to achieve all of your financial goals. You can learn more about how we can help, or simply connect with us online to schedule your free consultation.