We live in a society that’s largely focused around instant gratification. We like immediate rewards. We like seeing immediate positive consequences to our actions. This applies to so many different areas of our lives, but it applies to money too! When we work hard, we like to be able to get something nice for ourselves as soon as we’re paid. We want to see the rewards of our work quickly and we like to feel the positive emotions associated with it quickly. But when it comes down to it, we can’t realistically treat ourselves consistently.
Sure, we may have the means to right now. But even then, you need to look forward into the future and make sure that you’re prepared to care for yourself during a time when you’ll no longer want to or be able to work for an income.
This may be difficult to focus on, or something that you simply don’t want to focus on. But for many of us, old age will be a reality and you’ll thank yourself down the line if you’re comfortable and able to enjoy these later years of your life!
Here are a few suggestions that can help you to secure your finances in preparation!
Pay-off all your debts
Before you think of saving money for your future, it is advisable to first pay off all debts.
However, paying off debts ultimately can be a bit challenging. At one point, you may feel financially exhausted, and this can make you slack off from paying some of the debts. Nonetheless, you need to remind yourself why you are doing it and imagine living a debt free life in your old age.
If you pay off your debts and loans, you can significantly increase your financial security and reduce your life stress.
Use free online tools that help monitor and keep track of the debts you have. You can see which debts are large and need to be paid first. Such devices can also help you know the exact amount you should pay by calculating the interest rates.
It would be best to use a mortgage payoff calculator to help you pay off the loan you took out for buying your house. This way, you will be a proud homeowner at an old age.
Plan Your Pension
Your pension is something that you should be bearing in mind from the moment you start working.
This is the money that you’ll live on when you’re no longer bringing in an income. Now, many of us nowadays are guilty of maxing out your 401k. This is when you are tied into a pension plan that you pay into and then empty it out rather than actually saving it. It’s important that you don’t do this.
Firstly, you need the savings to live on later. Secondly, there’s a good chance that your employer adds a contribution to match or contribute to the amount you pay in each month.
If you keep your 401k going until retirement age, you’ll receive these extra contributions. If you empty your 401k out, you lose them. All in all, it’s more profitable to save for your future!
Buy Rather Than Renting
Many of us rent nowadays. It’s notoriously difficult to get on the property ladder. The wealthier amongst us have bought up more housing than they use themselves and are renting out privately.
This has driven house prices up and also means fewer houses are available to begin with, meaning people start privately renting and are often unable to save a deposit, as they’re already busy paying their landlord’s second, third, fourth, or another mortgage through rent.
If possible, however, do your utmost to save a deposit and get your own foot on the property ladder. It may seem difficult, but you may be able to get there.
Then, you’ll actually be paying your own mortgage and will eventually own a house outright. In old age, you’ll no longer have to worry about meeting rent payments to keep a roof over your head.
Invest in Life Insurance
This step is more to secure your loved one’s finances rather than your own.
While it’s relatively unpleasant to think about, many of us worry about how our families are going to be able to afford our funerals when we do pass. They don’t come cheap and you don’t want your loved ones digging themselves into debt associated with your passing. This is where life insurance comes into play.
Even if, by old age, you don’t have any dependents who require your income or money to survive, you do want to ease financial stresses on them. Life insurance payouts can help to cover funeral costs and reduce further stress on grieving loved ones. Of course, it’s a good idea to compare the different policies out there.
This way, you know your options. You can find the best policy that ticks all of your boxes for the lowest price possible. Using price comparison sites is a good way to achieve this!
These are just a few different areas to focus on as you advance to older age.
They’ll help to keep you as financially secure as possible! Many of us don’t consider any of these things until too late along the line. So, start thinking about them and taking them into consideration now. A comfortable old age really does require careful planning and there’s no better time or place to start than the present moment.