Living on government-funded retirement benefits alone can be very challenging. This is why most working adults try to set aside savings to help keep them financially comfortable during retirement. But the decisions you make with your money now will have a huge impact on how much you really have to work with once you’re ready to retire. So, in today’s guide, we’re going to take a closer look at 5 ways to get the most out of retirement savings!
Invest In Real Estate
Many people assume that a 401k or IRA account is the only way to save for retirement. This could not be further from the truth. If you want to be comfortable in retirement, owning your own home is one of the safest options. Even if you don’t want to live there when you’re retired, you can sell the home or use the equity to get a reverse mortgage. Either way, buying a home now can make your retirement years so much easier. And if you’re currently preparing to move into a new home, be sure to get help from the experts at Black Tie Moving!
Take Advantage of High-Interest Savings
For years, it seemed like traditional savings accounts were a complete waste of time. The interest rates were incredibly low, and you could get much better returns by investing your savings in the stock market. While this is still generally true, interest rates have increased substantially in the last few years. Now, you can put your money into a savings account and see much larger returns, with none of the risks associated with traditional investments.
Opt For a Roth IRA
In addition to a high-yield savings account, you should definitely consider opening a Roth IRA. Unlike a traditional IRA, a Roth IRA makes you pay the taxes on your contributions now. Since most experts anticipate higher tax rates in the future, this means you can pay more today to save way more during retirement. Even if you prefer a different type of IRA, remember that IRAs have an average annual return between 7% and 10%, making them one of the best retirement savings options on the market.
Start Increasing Your Contributions ASAP
There is no time like the present, especially when it comes to retirement savings. You may not have a lot of expendable cash at the moment, but just a few dollars a week will grow much faster than you realize. Once you’re in a better financial position, you can start increasing your contributions to your retirement portfolio and savings account. The sooner you start building wealth for the future, the better!
Develop Passive Income Streams
When most people think of passive income streams, they think of ways to make enough money to pay their bills today. While that would be great, it can be extremely difficult to achieve. Instead, you should focus on passive income streams that can continue well into your retirement. These might include dividends from investments or income from ads on a website. Even bringing in a couple of dollars a month could help tremendously when you’re ready to leave the workforce!
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