Financial Planning Earlier in Life for Later in Life Needs

financial planning

25 or 45: Why We All Need To Have Do Financial Planning For Later In Life

One in three Americans have no retirement savings at all and almost half of Americans have less than $10,000 saved for their retirement plans. Financial Planning – Whenever you think of your financial future, often one word pops into your mind: security. Whether you are just starting out in the world of work or heading rapidly into retirement, it is important to think about and plan for your needs later in life. Taking the time to financially plan allows you to be in charge of your family’s financial future. Whether you end up being a care partner or may need assistance yourself, planning for your future is essential.  Here are three great reasons to start your financial plan today.

The Retirement Factor

As we come to the natural end of our career, our income will change. Loss of a monthly salary and benefits provided by your employer can significantly affect your quality of life. This is where great financial planning comes in. It is time to start thinking of a retirement financial plan. A sound financial plan gives you stability in retirement and can also help you in achieving those ideal retirement goals of yours. How does it do that you may ask? Sitting down to map out your vision and the lifestyle you wish to maintain after retiring, allows you to envision exactly what you need to fund that vision.

Regular contributions into retirement savings account such as IRAs or employer supported 401 (k) plans are great ways to get started. Investment tracking tools are great for helping you manage your investments both before and after retirement. With different income streams in retirement, it will be important to keep track of them. Feedback about SigFig, Mint and the Personal Capital Review suggest that automated investment apps gives you more autonomy and freedom over your investments.

The Health Factor

As we age, we take every precaution to live healthier, more active lives. We eat a healthy diet, make time to exercise and invest in vitamin supplements. One other thing we should be doing: planning ahead for your medical needs. Whether it is planning for long term care expenses or putting away savings for any medical expenses that may pop up, thinking ahead about how you will fund your needs is a great proactive and important step.

Making allowances for your medical care means when the time comes, you will not be flustered looking for finance at the last moment. You also get the time and option of choosing how to fund these needs. Options for funding range from savings, investments made earlier in your career, with your pension or by even choosing to buy a long term care annuity. Choosing to get a care policy earlier rather than later can save you thousands in premiums. In 2017, a survey by Northwestern Mutual showed that healthcare costs were the number one fear of Americans when saving.

The Uncertainty Factor

When thinking about the future, most of your decisions are bound to be made on estimations. This is precisely why planning for the unknown is important. While we cannot guarantee what will happen, being prepared for the event of an unexpected loss, family emergency or even the volatility of the market place reduces stress and as a bonus, minimizes the chances of you having to turn to expensive debt options. Planning ahead while you have the time and ability to makes sure it is done and dusted, potentially avoiding any vulnerability later on.

Finally, take into account your personal situation and of course, your risk appetite. For someone with a more conservative appetite, investments in bonds and securing long term healthcare insurance policies may be preferred. Others may tolerate higher risk options in exchange for a higher return. While the future may contain some aspect of uncertainty, there are certainly a number of effective steps you can take today to better prepare for the future. Whether you begin by simply putting away as much as you can each month or by pursuing an investment portfolio, it is vital that you get started on your financial planning future.