Like it or not, everyone will retire one day and retirement is a moment for those with experience to leave the world of work after decades of working for a living. But are you financially prepared for retirement? Every individual who is about to approach retirement certainly has a dream to retire in a state of having enough retirement money or pension to cover a quality life after retirement.
Is your financial preparation before retirement sufficient to cover the cost of living and health in old age? The question is not whether you want to retire sooner or later. However, what is more important is that your planning towards retirement should be done from the beginning. Retirement planning in old age is very important to ensure a comfortable life and free from the burden of debt. Relying on EPF savings alone may not be sufficient considering the length of time with your lifestyle after retirement is still long. What will happen if you fail to plan for retirement properly?
This means that equipping yourself with financial preparation before retirement is very important. Therefore, start planning as early as possible, even if it is still a long time to reach retirement. Early preparation is important because medical, education and living costs are increasing over time.
Here are some tips that can be used in preparing financial preparations before retirement.
1. Debt Free
Make sure before you retire you have paid off 80 percent of your outstanding debt. Examples such as vehicle rental debt, credit cards, education loans or personal loans. Never add new debt that charges high interest rates.
Start with a small amount and set a period of time. Do not delay in starting the habit of saving.
3. Assess current financial status
You need to assess the income you need to have in retirement. You need to evaluate existing savings along with other assets such as insurance, house, land, shares and so on.
4. Be disciplined in Financial Planning
Be careful in planning your finances. Avoid making arbitrary withdrawals and make sure it is enough to cover expenses until the end of your life
5. Equip yourself with skills
Master yourself with existing skills that may be very useful when you retire later to generate side income if necessary.
What is important is that you need to equip yourself with a financial plan that can guarantee a satisfying life and free from the burden of debt after retirement. Most importantly, after deciding to retire and no longer work, there needs to be a plan so that the daily routine remains busy and filled with beneficial activities.
Well-being and welfare in the golden age if arranged from the beginning will not only allow us to enjoy the remaining age in comfort, but will always be appreciated by the family and the surrounding community. If you want to ensure comfort in retirement, you can start taking care of your finances seriously with long-term planning in mind, don’t forget to stop spending on things that only give temporary satisfaction.