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Retirement: How To Manage Your Finances Once You’ve Retired

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Important Facts About Your Retirement & Finances

Retirement can be a difficult time. If you have worked all of your life, you may have become institutionalized. While lots of people hate having to get up early and sit in traffic before spending all day doing something just so that they can pay the bills, if you do that for fifty years, suddenly not doing it anymore can be disorientating. It can also have a big impact on your finances.

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Without a wage coming in every month, you are going to have to run your household differently. There are some costs that will be reduced, like expenses associated with a commute for instance, but you still have to pay for everything else in your life, including food, energy bills and all of the other essentials. If you are concerned about how you are going to manage your finances once you retire, here are a few tips:

 

While it may not seem like particularly useful advice if you have already found yourself retired, but saving over the course of your career is a good idea. While it does not become clear just how important it is until your opportunity has gone, you should put some money away each month, and by the time you stop working, you may have enough to support yourself.

 

Taking advantage of a 401(k) if it is offered by your employer makes sense too but you should also investigate whether you are owed pension money that you are not currently claiming. The US government estimates that over 38 million Americans are not doing exactly that and if you would like to find out if you are one of them, you can check here.

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It is estimated that if you want to maintain your pre-retirement lifestyle, you will need about 80% of your former income. This is quite a lot of money which is why many retired people do not give up work completely. Part-time jobs are great, but if you have amassed skills over the course of your career that are still marketable, you can consider consulting or freelancing. If you are able to work from home, it could be perfect. If you find the right work-life balance for you, you can get the best of both work and (partial) retirement.

 

There are more ways to earn money besides working though. You may find that as you grow older, you do not need as big a house as you currently have. You do not need to move into a retirement village to downsize. You could consider selling house as is; some companies will offer you cash which lets you get a small place and live on whatever is left. Another option is to rent out rooms in your home. Apps like Airbnb have made it easier now than ever before to make money from your home on your terms. You can rent it out whenever you like as the schedule is completely down to you.

 

Retirement and managing your finances

 

If you are concerned about how all the numbers add up, you can calculate your expected income using a retirement calculator and start planning today.

 

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