One of the benefits of old age is being able to retire. But how to do you fund your retirement? After all, you don’t want to worry about anything as mundane as insufficient money in your retirement. So, how do you make sure you have a prosperous retirement?
- Work for a company that has a pension plan. In my opinion, the number one way to fund your retirement is to work for a company that has a pension plan. Do your research and find a company that has a pension plan.
- Max out your 401(k). Put in the maximum amount you can each year. These funds will help you retire in comfort. I recommend buying index funds – domestic and foreign.
- Set up either a Roth IRA or IRA. These funds will come in handy during retirement.
- Buy a home, and keep it for thirty years. When you are ready to retire, you can sell your house, or take out a reverse mortgage.
- Try and collect Social Security. Not sure if social security will be around when you retire, but if it is – try and collect it. I doubt this will be sufficient, but every bit counts.
- Buy stocks and mutual funds. Compound interest and time can work wonders. Buy good quality stock and bonds, and stock them away for 30 years. When you are ready to retire, your stocks and bonds will hopefully have grown as an acorn grows into a tree.
- You could continue to work. Hey, retirement was a concept from forty years ago, when people died young. Now people live a lot longer. Your mind is active, and so is your body. You can just continue working; this way you don’t have to worry about your standard of living declining.
- Buy an annuities or insurance plan. This assumes that you have money now, with which to buy – or you have a large income. If you do, remember to research annuities and insurance plans before buying.
- Inherit some money. This means you have to have affluent relatives who remember you in their will. If you don’t have accommodating relatives, consider marrying someone who does; you can still inherit as the spouse. This is a difficult road to travel and I caution the faint of heart from doing this. Marrying for money is hard work. Be prepared to be called a gold digger if you go this route.
- Live off your investment income. Accumulate a large portfolio of stocks and bonds worth several million dollars and live off the interest. This takes a lot of discipline, if you don’t inherit any money to begin with, but it can be done.
There are just a few of the things you can do to retire in comfort. Each of you needs to think about which method or methods will work best for you. We are all individuals and our idea of retirement is different for each of us. So, there isn’t a cut and dried method to use.