Last Modified on March 2, 2020

You work hard, struggle through life, and balance your finances only to have a good present and a secured tomorrow. The dream is to live in the moment but also prepare well for the future so that you can retire with peace, with enough savings and investments to last you for the rest of your life.

But for this purpose, you need to start financial planning early and young. You should be futuristic and well aware. It is important to save every bit, get sound financial advice, and make smart investment decisions. While all this might seem complicated, it is quite simple to achieve it with small adjustments over time. All you need are some lifestyle changes and simple habits that can bolster your retirement plans. And to ensure you don’t perceive this as rocket science, here is a guide to some of these habits that will help you achieve your goal faster.

List and track your expenses

It is important and also wiser to always list your current expenses and then track them as they occur. You should know how much of your hard-earned money is being spent on different components of your budget. This is a critical aspect in bolstering your retirement plans since this helps to increase your savings by allowing you to continuously monitor your expenses and cut down on them if there is a scope. You would be surprised by how much you can save by this simple habit. You would notice some of the completely avoidable expenses, while there could be others that could be drastically reduced. Simple things like taking the subway, walking to work, eating at home, opting to recycle or reuse can have bigger implications in the long run than you expect.

Set a savings goal

A simple wise habit to adopt when you are young and working is to simply set a saving goal for each month. You can do this by first listing all your income then deducting the expected monthly expenses to arrive at a final amount. Remember to also factor in costs of emergencies. Keeping this figure in mind, set your saving goal for each month and keep a strict check on yourself to meet that goal. Try to avoid expenditure that is outside of your planned expenses. Setting up automated savings can also be helpful as each month a certain amount gets deducted from your account as a part of your savings. Moreover, you can also use various financial apps to help you organize your finances better. As a bonus, each time you meet your target, you may treat yourself to stay motivated. But remember to keep your indulgences in a budget. As a rule of thumb, you should always spend less than you earn.

Keep raising the savings bar

Life can be full of surprises and you should certainly be prepared for the worst of those. Financial surprises are not pleasant and hence, it is important for you to plan for them wisely. With each year that passes by, the value of money depreciates, your wants increase, the good and services become more expensive due to inflation. It is highly possible that the amount you are saving right now might not be enough to sustain your retirement expenses. But keeping a long-term view can help you. The simplistic thing to do here is to keep increasing the amount of your savings. You should consider accounts with a high rate of interest that can help you cover the costs of inflation. Raising the bar of your savings is important. So, every time you earn an increment or bonus at work, make sure to contribute some bit of it to your savings pool as well.

Picture your long-term goal

A simple habit to adopt in order to boost your retirement plan is to always think long-term. While setting a budget and savings goals for the present is important, you should also account for your future expenses. It is essential to consider medical fees, higher education or marriage expenses for your children, or other similar costs that may arise in retirement. Sit back and analyse if all your savings will be enough to meet your financial responsibilities. If they do not, you can open a side business or work part-time on weekends to save a little more.

Minimise your debt

Debt can eat away your hard-earned income. Credit card bills come with a high rates of interest and can also affect your financial standing and credit score. While home loans, education loans, etc. may be necessary to meet your goals from time to time, ensure that you repay them as soon as you can and do not end up spending all your savings on interests.

Make wise investments for the future

Savings alone may not suffice for the future. You also need to take a leap in your thought process and make sound investments for the future. Make sure that you spend some time on devising a balanced retirement portfolio.

A retirement portfolio should be designed as per your needs and should suit your unique goals by factoring in personal preferences such as risk appetite, age, income, expenses, and other variables. You can also take advantage of several retirement saving plans that provide tax benefits such as the Individual Retirement Account (IRA), 401(k) account, or an employer funded plan. To ensure that you set your foot in the right direction, you can take help from a professional financial advisor while also being vigilant, participative, and constantly widening your knowledge on the various investments you can use to increase your corpus.

Protect what you have

A simple habit to secure your retirement plan is to protect it against uncertainties and damage. Insuring your property, car, valuables, etc., can help you cope with calamities, theft, etc. You must have exhaustive insurance that provides benefits for the future. Health, life, and real estate insurance can be an effective tool in securing your future and ensuring that your family is well provided for in your absence.

To sum it up

A peaceful and protected retirement is an easily achievable dream provided you put in the time and discipline required to grow your money. Simple habits such as watching your expenses, limiting unnecessary spending, increasing savings, and investing wisely can help you a lot in the long run. 

If you need help in retirement planning, you can reach out to financial advisors. With their expertise, they can offer unique solutions to you based on your goals.