The word “retirement” sounds pretty scary to most people. The reason for this emotion is that they have failed to plan properly and lack confidence in the process. This article will provide you a simple, yet effective, roadmap to reach your retirement objectives.
First, stop thinking like everyone else when it comes to finances. Yes, it is fine to be different. You must understand that your circumstances in life are most likely different from many of your friends. Some employers support their employees in planning for their futures while others do not. Your new mindset should be that of “I will depend on no one but me for my future plans”.
Do you often wonder why the ultra wealthy have the financial security they do when they may have started life in a lesser social/fiscal position than you? Do they know a “secret” formula for success that has eluded you in life? The answer is a resounding NO. However, the ultra rich think far different than the typical person. For example, to accumulate wealth you must do this simple task:
Invest for retirement first and then spend the rest
If you have a goal of saving ten percent of your income, place this 10% in your retirement and then plan your spending with the remaining 90% of your paycheck. For many of us this will sound very opposite than what we have been doing for our adult lives. Remember, it is OK to be different because you have different dreams and aspirations than anyone else. Don’t listen to the negative comments of the mass population who struggle from paycheck to paycheck with no change. You can make this change rather quickly and simply.
Second, learn to live within your means. This step requires you to know where each of your dollars are spent. To accomplish this, write down every penny spent for a week. Upon the conclusion of the week, categorize the areas you have spent your money and you may be startled when you become aware of where your money went! For example, “Did I really spend $32 on specialty coffee this week?!?” “Do I need all of the subscriptions that I don’t read regularly?” “How did I accumulate a bad habit, like tobacco use, that costs me $40 per week or $160 per month??”
Once you analyze your spending, you will quickly see areas you may derive savings for a better purpose – your future. The most difficult part of this process is writing everything down. To accomplish this, purchase a small notebook and carry it with you at all times. Record every penny you spend for whatever reason. Be honest with yourself. The only person to be cheated by not being honest is your future you.
Remind yourself daily, if not several times per day, the “why” for taking these measures in your life. You deserve a comfortable retirement, in terms you define, and can reach your goals with small steps performed on a daily basis. The action step to take is:
Know where your money is being spent and correct course
Lastly, Step 3 is the most impactful, powerful and simple of the steps to reach your retirement goals – measure your progress and celebrate when reaching small goals. The purpose of this step is to remember that you are on a journey and the lifetime goal is too far away to see. The best method for reassuring yourself of the progress you are achieving is to look for the next step in conquering your next challenge, not the ultimate
Celebrate small wins frequently!
To assist you in the process of defining your roadmap for the future, you may wish to seek out a financial adviser or CPA that specializes in retirement planning. The price paid by far too many people for failing to plan is very severe. Don’t pay that price, take these simple steps today to design the future you wish to live.