Three Tips to a Happy Retirement 22 Jun 12

At a time when many folks are struggling to just get by, saving money for retirement may not seem like a top priority. In fact, as reported in a recent Fox Business News article, almost half of Americans aren’t contributing to any type of retirement fund. That’s a scary thought when you consider around 26% of the population, the Baby Boomers, are already at or are rapidly approaching retirement age.

If you’ve yet to start saving or are not contributing to a defined retirement fund, don’t assume you can, “worry about it later,” or simply “plan to work longer.” Time has a way of slipping through your fingers, and you never know what unforeseen circumstances may keep you from working into your 70′s or 80′s.

Whether you’re starting young or are late to the game, there are a few retirement saving practices everyone should follow. Adhere to these three strategies to get the most out of your efforts.

Save More

True, this is hard to do if cash is already tight, but most people find, with some sacrifices, they actually do have leftover money to save. Scrutinize your lifestyle and start to eliminate the money-draining things you don’t really need.

For instance, if you claim to have no money for retirement, can you truly justify living in a 2500 sq. ft. foot home when you could scale down and save a bundle by fitting your family in a small 1,100 sq. ft. apartment? It may seem small, but in keep in mind, in many parts of the world whole families live happily in 600 sq. ft. or less — it’s all about perspective. In addition to your house, look at your car, entertainment, food, and more. There’s no point pretending to be rich now if it’s going to lead you to poverty later.

Choose Investments Wisely

With the recent drops in annual returns, you can’t afford to squander away money on fees and expenses. Even something like a tenth of a percentage can seriously add up over decades, so do your homework before choosing an investment service, and make sure you know exactly where all of your money is going and why.

Also, considering the uncertain economic climate now is not the time to start making risky investments (especially if you’re working with limited funds). Conservative investments with assured long-term payouts are your best option. However, if you’d like to play around with something riskier and with the potential for more aggressive growth, make sure you only devote a very small portion of your savings to this area.

Plan to Live Longer

One of the biggest mistakes people make in regards to retirement is underestimating their life expectancy. Today, people are living longer than ever, and you don’t want to get to you 90′s or older, when going back to work is out of the question, and realize you’re out of money. Of course, everyone wants to live as long as possible, so plan for it! Your golden years are not the time for worrying about money or how to make ends meet. Do yourself a favor, and take the steps now to ensure a happy, comfortable retirement.