Once you reach the age of retirement, you stop working and expect to live the life you had always wanted, with money and time aplenty. Unfortunately, for many people, they find out too late that their retirement savings are just enough for them to live on a day-to-day basis and not much else.
This data just shows the importance of planning your retirement now, while you’re still young, and not when you are already nearing retirement age. There are many ways to increase your savings in the best way possible. Take a look at some of the options below.
IRA, or the Individual Retirement Account, offers a savings account with big tax breaks. There are three types of IRA, each varying slightly with regards to amounts needed for investing and the returns. These are the (1) traditional IRA, (2) a Roth IRA, and (3) a Rollover IRA.
An IRA will allow your savings to grow quicker than they would in a traditional savings account. Just be aware of any penalties for withdrawing the cash early as this can vary. Still, investing in an IRA is a reliable and relatively safe option for your money.
Many people are now investing any savings they have in the hope of getting a good return back on their capital. Options include purchasing an annuity, buying stocks and bonds, purchasing shares, or investing in hedge funds in retirement.
Retirement investment is not a lot different from any other types of investment, except that the return you get may need to act as your only source of income for anything up to 35 years. It is always advisable to take advice from a financial expert if you are thinking of putting your money into an investment as they will help you understand the full implications and the likely returns you can expect from it.
Investing in property always used to seem like a safe option but since the most recent economic crisis, this has been shown to be not as safe as we thought it would be.
However, with some savvy thinking and understanding the market, it is possible to invest wisely in property and see a good return. Property investments for student accommodations and holiday accommodations, for example, are probably one of the best types of property to invest in these days. Although these industries had also been affected during the financial crisis, they are still stronger than the normal rental properties. Just make sure you take advice and do your research to ensure you purchase in the right place.
There are numerous pension plans available either through your bank, your employer, or an insurance company. People have become very cautious about pension plans, though, especially as some have collapsed amidst a blaze of publicity and left many investors with nothing.
However, there are also some safer options available for pension plans; it is just a matter of doing thorough research to find the best one for you. The general rule is that the smaller the risk, the less return you get on your money. Decide what is the best option for you.
High-Interest Savings Account
Probably the safest option available is to place your money in a high-interest savings account, especially if you might want to get hold of the money at any point. You can normally withdraw money from such an account with some notice, normally from 14 to 28 days. It means that if you are concerned about putting money into another form of retirement plan and you can’t get the money until the plan has matured, this might be the best option for you.
Whatever you decide to do to save for your retirement, just make sure that you go into the agreement knowing exactly what risks you are taking and what returns you can more or less expect at the end. You must do your due diligence if you want to protect your future.