Save for retirement with these tips
/Retirement is a time where you finally leave the workforce and enjoy what is known as your golden years. However, when you retire, you won't have access to an income stream anymore. Instead, you'll have to live off of what you've saved over the course of your career. But with no income stream and the rapid fluctuation of inflation, your savings can drain faster than you think. This is why it's important for you to take precautionary measures to build financial security before it's time for you to retire. In this article, we'll be covering ways for you to have financially secure before it's time for you to retire.
Sell Your Life Insurance
At first glance, getting rid of your life insurance policy doesn't seem like it would help. However, the truth is that selling your life insurance can make building financial security easier for you. While you can give it back to the company, acquiring a life settlement is usually the best course of action for retirees.
A life settlement is when you give your policy rights to a third party. The person or company who acquires your life insurance becomes the sole beneficiary. In exchange, you'll be given a cut percentage of the policy's overall value. This percentage can go all the way up to 30 percent, so you're bound to walk away with a considerable amount.
Please note, selling your life insurance policy is not a decision to be made lightly. It is not a decision for everyone especially if you have dependents. Be sure to do your research and speak with your financial advisor before making this decision.
Open a Tax-Deferred Retirement Account
A tax-deferred account is a type of retirement account that lets you skip paying taxes for a time. It functions similarly to any other savings account except you won't be charged taxes until the money is eventually withdrawn from it. In fact, tax-deferred accounts are a part of IRAs and 401ks.
You might be wondering why you shouldn't just use a regular savings account. With regular savings accounts, the money you save has taxes deducted from it the moment it's deposited. This is combined with withdrawal fees as well. Tax-deferred accounts let you deposit an entire amount with no additional fees.
Start Saving for Retirement Funds
Investing money into your personal bank account for your retirement account should be done in conjunction with the previous option. When retirement comes, you want to have as much money as you can to prevent an issue from occurring. Many have had to come out of retirement because they didn't have enough left over. Determining how much to save for retirement depends on a lot of factors such as lifestyle preferences, living arrangements, and any current health concerns.
Start a Side Job
Just because you're in retirement doesn't mean you shouldn't have an income stream. The truth is that you can easily acquire a side job to make sure you never run out of money. Whether it's working part time at a store or opening your own online business, a side job can prevent a lot of problems. Not to mention, they also keep you busy during retirement, so you're not bored.
Disclaimer: the content presented in this article is for informational purposes only, and is not, and must not be considered tax, investment, legal, accounting or financial planning advice, nor a recommendation as to a specific course of action. Investors should consult all available information, and consult with appropriate tax, investment, accounting, legal, and accounting professionals, as appropriate, before making any investment or utilizing any financial planning strategy.
