Monday, September 3, 2007

How to Financially Plan for your Retirement Today

Saving for retirement is something that can be difficult, especially if you begin too late. So when is a good time to begin saving? Right now! Even a few years can make the difference of several hundred thousand dollars once you factor in interest. You should set a goal of setting aside a certain amount of money every month from your paycheck to put into your 401k.

People are constantly saying, But I dont have the money to put aside right now. In some cases this may be a legitimate argument. For many though, there are a number of things you can cut back on to help increase your 401k. For example, is it truly a necessity to have that Starbucks latte every morning before work? Is it absolutely vital that you eat out for lunch as oppose to packing a lunch?

Every little bit matters and when you add up the costs for your latte in the morning and your Big Mac with fries for lunch, you would be surprised to see how much you are actually spending. Although there are things like pensions to back you up, even your pension can be quite surprising when it comes time to collect your earnings.

Unlike what many people believe, a pension will only get you 30% as oppose to the 60 or 70% that is assumed. While this is certainly beneficial, it is something that people shouldnt rely on.

While saving is perhaps the biggest part of planning for your retirement, having a decent insurance policy is up there as well. There is no denying the face that as we grow older, so do our bodies. We will encounter more health problems and are more susceptible to diseases and surgeries. By having a reliable insurance plan, you can avoid getting that overwhelming medical bill that will send you back to the workforce.

The main problem people have with planning for their retirement is that it is in the distant future. Then, little by little the time will sneak up on you and you will begin to realize you are completely unprepared. You can still live your life in the present and enjoy yourself, but it will be much more comforting if you take a small amount from your paycheck each month and place it in a retirement fund of some kind or a 401k.

Joshua Spaulding is an Author and Webmaster providing Quality Finance and Investment Articles through his Quality Article Directory at Joshua educates thousands of people everyday on solid investment plans, as well as various other things.