As Americans, we try to do our best to prepare for all outcomes. Retirement is one of those issues where we seem to be having a difficult time planning for. Many millennials and even older generations have been unable to save for retirement. They’re dealing with low wages and tons of student loan debt.
Even if you’re 100% organized and ready for retirement, what happens if you’re forced to do it earlier than planned? This is one trap even the highly organized person can fall into. Life can throw us a curveball we’re not prepared for. So, let’s prepare for it! It’s really the only way to pull off your retirement the right way without being left in the dust.
“Best way to be prepared is to have a plan. It’s why I encourage people to have a 3-6 month emergency fund that they just set aside and you can just keep that liquid in a money market account and it’s available if life were to happen,” said Chris Hogan, financial expert and author of the book “Everyday Millionaires”.
“There are all kinds of plans and options out there. Don’t sit back and not be informed. Engage with an insurance professional so you can understand what’s out there. Or what are some gaps in your coverage that you may need to purchase an additional policy to be able to protect yourself and your family.”
Are Americans Fully Prepared for Retirement?
According to new research from the Center for Retirement Research, a large percentage of us are not ready for that curveball. It’s almost as if we don’t expect anything to happen that will curtail our plans. That’s how most people plan their life. They aren’t prepared for the ‘anything can happen’ rule.
As a result, nearly 37% of older Americans are forced to retire earlier than planned. This is due to a health scare, accident, or the loss of a job. We don’t know when the economy might tank or we’ll be forced out to make room for younger, faster employees. As things change, businesses are become more high-tech and demanding different types of talent to thrive.
The key to being fully prepared for retirement is getting out of debt as fast as you can. Downsize your life if you have to. Start saving money. If you don’t have a rainy-day fund right now, that can hurt you no matter the age. Most Americans don’t even have $400 in their accounts if they needed it for an emergency. That’s an alarmingly small amount of money.
“First thing I tell people is to get serious about getting out of debt. When you get out of debt, you actually free up your money. You give yourself a raise, and it’s really important for student debt not to just hang out like it’s a relative, but you actually treat it like an enemy,” he said. “You get very, very serious. You downgrade lifestyle. You take on extra income. You do whatever is necessary to attack that debt.”