The Kids Are Gone, But I’m Just Ten Years From Retirement With Almost No Savings. Help!

Good news! With the kids out of the house and on their own, you can focus more time and money on preparing for retirement. You can’t catch up with ten years for what you should have accomplished so over the last thirty years, but you can make retirement a reality.

Follow these tips for a fast track retirement:

1. Scale back the vision. Without a retirement fund at age 55, you can’t have saved enough to securely maintain the lifestyle you’ve had in retirement. Focus not on your dream retirement, but what is realistic. By preparing for a more modest lifestyle, you can significantly reduce the income required in order to fill the gap between social security and the lifestyle you want.

2. Save at least 20% of your income. Even saving 20% of your income, won’t be large enough to fund the retirement you want in just ten years. There just isn’t time for investment returns to compound and do much of the work for you. You’ll have to really sacrifice to make retirement possible.

3. Plan to be a part of the proper home for retirement. If you had several children, you may discover that your home is greater, perhaps much larger, than you is a need to. Sell your spacious home and buy a small home suitable for retirement (no stairs). Make sure you have to decrease or eliminate your mortgage when you move. If you can’t eliminate it, take out a ten year mortgage so that your home is given off when you retire. If you rent now, endeavour to purchase a home you can afford with a ten-year mortgage.

4. No more car loans. If do not leave a car loan now, congratulations! It’s your former one. Don’t ever buy a car again with a loan. Using a loan is more expensive and offers you a false sense of what you can afford. If you do away with $200,000 in your retirement savings, you’d almost certainly never spend $30,000 of it one day in a new car. If go through the money, you’re doing the same thing (except that you’re spending $31,500 instead).

5. Review your balance sheet. Your balance sheet or list of assets and liabilities may hold some surprises. Review it carefully. Look for assets that can be converted to cash to reduce any outstanding debts. With advice from your CPA, use those assets now to stop the interest on the debt from working against your retirement plans.

By taking these five simple (but potentially painful) steps, you can set yourself up to retirement, even if that hasn’t been a high priority in your planning so far. If you roll into retirement with a home you own free and clear, and no other debt, your need for income is lowered. Combining what you save over the next ten years to produce income from your social security will allow you to enjoy a safe and secure retirement.