One of the problems with being so busy working hard and raising a family is forgetting to put money away for your retirement years. This can be especially troubling if you’ve worked for a company that does not offer a pension or a retirement plan. Maybe you also helped pay for your kid’s college education and, in the meantime, wracked up some serious debt on your credit cards.
If this is the seemingly dire financial situation you find yourself in after fifty years old, don’t panic. There are ways to dig yourself out of your financial hole and put away enough cash for your retirement, and one of the most promising ways is to file for a reverse mortgage.
Say the professionals at All Reverse Mortgage, if you’ve lived in your family home for decades and have been paying religiously on the monthly mortgage, you can apply for a reverse mortgage. If approved, you can tap into all that equity you’ve built up for all those years. In the end, you could land yourself hundreds of thousands of dollars.
Depending on your needs and wants, you can take your proceeds in one lump sum payment or equal monthly disbursements. Moreover, you never need to pay the loan back until you leave the house or die.
But what if you don’t qualify for a reverse mortgage? What other ways you can save up for retirement after turning the corner at fifty years of age? According to a report by the retirement organization AARP, if life were perfect, you would start saving for your retirement on the day you are handed your first paycheck. But young people have a habit of not thinking forty years ahead, much less comprehending four full decades.
Findings from a 2018 Federal Reserve report showed that up to one-quarter of all nonretired adults in the U.S. have no pension or retirement savings. Only 45 percent of people over the age of 60 still in the workforce believe their retirement savings are healthy and on track.
But suppose you’re still in your 50s and haven’t been very good about saving for retirement. In that case, it’s still possible to create the wealth you’ll need when the paychecks stop coming in. By choosing some smart financial moves, it’s said to never be too late to create a financial plan that’s inline with your financial goals.
Your best bet is to consult with a certified financial planner who can give you the advice you need that is specific to your personal situation.
Set Up an Automatic Savings
AARP states that the first item of business when saving for retirement in your fifties is to review your budget. Immediately get rid of any excess items you don’t need. One area where people grossly overspend is food, and just creating a simple meal plan can save you up to $100 per month on unused items or stuff you toss in the trash.
The second step is to calculate a savings goal that’s not only realistic but that will work automatically. You can place your focus on saving small amounts over a long period of time.
If people in your family tend to live a long life, then you should calculate living into your 90s. No one knows when death is going to come knocking at their door, but the average 50-year-old man can reasonably expect to live another thirty years while a female can plan on living another 33 or so, states the Social Security Administration. So, plan accordingly.
Pay Your Debts
If you’re carrying considerable credit card debt, you should concentrate on paying it down to save on cash. The same goes for your mortgage. If you can pay it off by the time you retire, you will be in a great position to apply for a reverse mortgage, which can free up hundreds of thousands of dollars.
Also, if you can eliminate as many household expenses as possible, you can add to your retirement savings. If you have a car loan, pay it off. Once you’re in your fifties, you should never carry a car loan ever again. Always pay cash for a new or certified pre-owned vehicle.
Invest and Stay Invested
If you don’t have a pension or a 401(k) or are self-employed, you need to create your own retirement plan. This means setting up automatic investments, including traditional stocks and bonds, and safe cryptocurrencies like Bitcoin. You’ll want to dollar-cost-average (DCA) into your investment fund daily, weekly, or monthly.
Naturally, when investment prices are low in a bear market, you will want to purchase more of them since it makes sense to buy things when they are on sale. It’s best to maintain a healthy mixture of investments so that if one or two go south, the others will pick up the slack.
Do not jump in and out of the market since this can result in terrible losses. Only dig into your savings in case of a financial emergency. Also, if you’re still happy and healthy once you reach your retirement years, you should look for a part-time gig or a stay-at-home job that you enjoy, which can keep the cash coming in.