Now that we just saved you a ton of money on your taxes, have you thought about what you’re going to do with all that saved cash?
If you’re anything like me, planning your next vacation sounds a lot more fun than thinking about retirement. But before you set sail for the Bahamas, consider a few ways you could use that money for your benefit.
- Create an emergency fund. Life is constantly throwing obstacles in our path that we didn’t plan for, and an emergency fund could keep you afloat when the unexpected happens.
- Make additional payments on debt. Don’t waste your money on high interest rates. The sooner you can pay off your debt, the more money you have to save for your future.
- Invest in yourself. Buy a book or take an online course to aid in your personal or professional development. Building new skills could mean higher pay.
- Build your wealth for the long term. What do you want your retirement years to look like? Building wealth for your future starts with planning today.
Social Security Won’t Be Enough
Did you know that the average American spends roughly 20 years in retirement, and, according to the SSA, the average social security check is only $1400?
Social security alone will not provide enough income to cover your daily expenses. Experts estimate you will need up to 80% of your current annual income to maintain your standard of living once you stop working.
So, unless you plan on working forever, you’ll need a retirement plan.
Start Planning Today
No matter what stage of life you’re in, now is the time to prepare.
If you’re young and new to the work force, it’s not too early to start planning now. Set some goals and start working towards them. The earlier you start, the more likely you’ll be able to live the lifestyle you want later in life.
If you’re in your 50’s and you never started a retirement savings because, like me, you were always planning your next family vacation, it’s OK. Figure out your time frame and start preparing today. It’s never too late.
Even if you’re living paycheck to paycheck, or your business is struggling due to Covid, you always have enough money to set a little aside for retirement. By having a plan in place you’ll avoid the temptation to spend it frivolously.
Spending a little less today will give you a bigger cushion tomorrow. Financial stress has been linked to diabetes, migraines, and heart disease. Not to mention anxiety and depression. A retirement plan will help to keep you physically fit, as well as financially secure.
Take Charge of Your Future
There is no “one size fits all” retirement plan. While my goal is to take that family cruise, your goal may be to spend your golden years relaxing on the front porch. We’re starting our savings at different times and our current financial situation is different. But one thing we both have in common is we want to keep more in the bank and give less to Uncle Sam.
If you’ve been investing into a retirement account and receiving tax deductions for your contributions, you may lose a huge portion of your savings to the IRS when you start withdrawing. Our Incite Tax team can help you reduce some of those taxes so you can keep more of that money you worked so hard to save.
That way, you can spend your retirement on the golf course, drink lemonade on your porch swing, or pack your bags for the Bahamas. The choice will be yours with careful planning.
Stick it to the IRS, and protect your savings.
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