Can You Take An Early Retirement On Time Debt Free?
The economy is unstable and the stock market has been take us down memory lane back to the days of severe recession.
At this very moment the financial market is pretty vague and if you are banking on the stock prices changing you could end up in desperate tears over the losses, let alone any of the gains you have gathered in your portfolio, over the years.
In a nutshell, here are eight things you should all ready be doing to protect your financial future and not just plan on the company 401K to get you through it:
1. You should try and save at least 30-35% of your income into interest bearing accounts akin to a savings account or credit union CD's. Heres the reason for my madness, you can get a rapid return over a shorter period at a elevated interest rate, without taking any more risk. When they the CDs matures or expired their interest bearding duration, simply move the money you have gathered into similar extremely high interest bearing CD and you want to invest the original amount as well as the interest you have earned. The goal is to grow the CD to a rather good size allowing you to divide the CD into 2 single portfolios and reinvesting the funds again. This will all you grow your funds rapidly due to the 8th wonder of the world, i.e. the power of compounding interest. The key is to grow your funds without exposing yourself to any more risk than you have to. Once you have grew your CDs you will have the ability to divert the CDs into the stock market when the time is right.
2. Consider moving a percentage of your 401K into an Roth IRA " the point is not to take all your money out of the 401K but rather just a portion of your employer sponsored 401K plan especially if your employer has a matching contribution to your 401K. Your employers contribution is free money for you to grow your 401K, so you do not want to lose that income stream.
3. Speaking of bonds...your money is far safer in a bond than stocks and you don't have to worry about a stock falling and taking your investment with it.
4. Avoid having debt in retirement. There is nothing worse that working at your local hot dog stand just because you dont have enough money to pay your bills. What gets even worse in retirement, you end up working for a kid old enough to be your grandkid, and calling him boss so that you can keep your job. The point is eliminate your debts before you retire.
5. Paying off your mortgage while you are young, will allow you to invest in other assets and grow your net worth rapidly. By using a mortgage accelerator strategy, you can become mortgage free 15 years faster, without changing your lifestyle or paying one cent extra towards your mortgage.
6. Set up an emergency fund in a separate account for those annoying little emergencies we all need petty cash for, so you are not tempted into dipping into your retirement funds.
7. Consider having your home insured at replacement value, not market value. The similar action for your autos. Do not insure your auto at state minimum if you live in an expensive neighborhood. It would be better to have a higher standard of insurance and invest in an umbrella coverage.
8. Health insurance and a prescription card are something that should be an immediate priority. Did you know that if you needed knee surgery to repair damage just the doctor visits alone could cost you over $6000 and the surgery could cost you nearly $9000.
The goal is to begin working on one item at time so that you do not get overwhelmed. The key is to set a timeframe and ensure you are able to complete each goal to protect your retirement income and your family in retirement. - 16931
At this very moment the financial market is pretty vague and if you are banking on the stock prices changing you could end up in desperate tears over the losses, let alone any of the gains you have gathered in your portfolio, over the years.
In a nutshell, here are eight things you should all ready be doing to protect your financial future and not just plan on the company 401K to get you through it:
1. You should try and save at least 30-35% of your income into interest bearing accounts akin to a savings account or credit union CD's. Heres the reason for my madness, you can get a rapid return over a shorter period at a elevated interest rate, without taking any more risk. When they the CDs matures or expired their interest bearding duration, simply move the money you have gathered into similar extremely high interest bearing CD and you want to invest the original amount as well as the interest you have earned. The goal is to grow the CD to a rather good size allowing you to divide the CD into 2 single portfolios and reinvesting the funds again. This will all you grow your funds rapidly due to the 8th wonder of the world, i.e. the power of compounding interest. The key is to grow your funds without exposing yourself to any more risk than you have to. Once you have grew your CDs you will have the ability to divert the CDs into the stock market when the time is right.
2. Consider moving a percentage of your 401K into an Roth IRA " the point is not to take all your money out of the 401K but rather just a portion of your employer sponsored 401K plan especially if your employer has a matching contribution to your 401K. Your employers contribution is free money for you to grow your 401K, so you do not want to lose that income stream.
3. Speaking of bonds...your money is far safer in a bond than stocks and you don't have to worry about a stock falling and taking your investment with it.
4. Avoid having debt in retirement. There is nothing worse that working at your local hot dog stand just because you dont have enough money to pay your bills. What gets even worse in retirement, you end up working for a kid old enough to be your grandkid, and calling him boss so that you can keep your job. The point is eliminate your debts before you retire.
5. Paying off your mortgage while you are young, will allow you to invest in other assets and grow your net worth rapidly. By using a mortgage accelerator strategy, you can become mortgage free 15 years faster, without changing your lifestyle or paying one cent extra towards your mortgage.
6. Set up an emergency fund in a separate account for those annoying little emergencies we all need petty cash for, so you are not tempted into dipping into your retirement funds.
7. Consider having your home insured at replacement value, not market value. The similar action for your autos. Do not insure your auto at state minimum if you live in an expensive neighborhood. It would be better to have a higher standard of insurance and invest in an umbrella coverage.
8. Health insurance and a prescription card are something that should be an immediate priority. Did you know that if you needed knee surgery to repair damage just the doctor visits alone could cost you over $6000 and the surgery could cost you nearly $9000.
The goal is to begin working on one item at time so that you do not get overwhelmed. The key is to set a timeframe and ensure you are able to complete each goal to protect your retirement income and your family in retirement. - 16931
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posted by Edgar at
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