The best way to ensure an enjoyable retirement is to be prepared. That means starting to save early and often. That also means asking yourself the key questions listed below.
Do You Have Enough Income?
You will get guaranteed income through Social Security payments, but that likely won’t be enough to retire. A recent study from the Employee Benefit Research Institute (EBRI) found that retirees who said they were “comfortable” in their post-work years had multiple sources of income. You should do whatever you can to ensure additional sources of income during retirement.
Are Debt Levels Manageable?
Look at your debt and see if it’s manageable during retirement. Is there a way to pay off your mortgage more quickly? Perhaps you could squash your credit card debt by signing up for a balance transfer card. Take steps now so that debt isn’t a huge factor during retirement.
Is Your Budget Ready?
Your post-work budget will likely look a lot different than your budget during your working years. Go through your spending line-by-line to make sure it’s in sync with your retirement goals. For example, if you want to travel, set the budget up to handle additional expenses in that category.
Are You Able to Handle Medical Costs?
Chances are you’re going to spend quite a bit of money on medical costs during retirement. As USA Today notes, a separate EBRI report found that the average 65-year-old couple who retired this year would need about $280,000 for out-of-pocket medical expenses during retirement. In other words, save more for medical costs than you think you’ll need.
Article distributed in partnership with SavvyMoney with reporting by Chris O’Shea.