Financial Articles

Not necessarily. Actually, it depends on your definition of ‘hard.’ I began a 401K and pension fund when I was hired on at my company 24 years ago. Today, I have a nice retirement. But that was just my individual case and I’m sure your circumstance is far different. So let’s focus on you, instead. Whether you’re twenty or forty, you have to make a tough decision. You have to do without something now to benefit later. In other words, you have to save money now, and that means sacrifice.

The younger you are, the less you have to give up. That’s because your savings multiplies faster over a longer term. Hence, you can put aside a small amount and watch it grow using the magic of compound interest. Assuming that you can get a 5% return on an average investment, we can run a simple chart. That return is based on most common tables that are not tied to equities or bond funds. Although most experts would agree either should generate that type of return. Even guaranteed CD’s, or certificates of deposits, backed by FDIC for safety sake, can offer similar rates. But whatever device you choose, let’s use that number.

So let’s look at one example. Suppose you are 25 years old and make $10 an hour or $400 a week or $1600 a month. After taxes that’s about $1200 monthly. I want just $150 of that, for your monthly investment. Figure that if you were to give up a Starbucks coffee costing $5 every day, there’s your $150 a month. Do that for the next 40 years and you’ve given me $72,000. But, by investing the monthly amount in a 5% returning account, the compound interest turns this into $228,900 by age 65. Not bad for someone doing without a Vente Café Mocha Latte every day. Now, as you make more with raises, job changes, etc., and you could quadruple that investment, you’ve got over $1,000,000 for retirement.

But I’ve got an even better plan. Could you squirrel away $5,000 for that first year? I know that’s a lot to ask, but hear me out. If you could manage to put aside $10,000 over two years and invest it, never putting in another dime, you won’t be able to guess what you would amass after 40 years. $50,000! But, if you could somehow get a 10% return instead, investing the same $10,000 for 40 years we would make you about $500,000! That is an example of how the interest rate affects the return. And there are ways to generate a 10% return using equities or mortgages. I suggest you talk to an investment adviser for that information.

The great advantage of this plan is you: (a) didn’t have to give up much, (b) don’t have to be an investment wizard, (c) let time and compound interest work for you, and (d) can look forward to a healthy retirement. Of course, the more you’re willing to give up now, the greater the end result. But working harder isn’t the answer: it’s saving smarter and earlier. Therefore, if you’re in your twenties and figure retirement is decades away, you’re right and that can work in your favor. So start planning now and the rest will take care of itself. Savings for retirement is hard? Myth busted!

You have reached the age of retirement or you took early retirement for any reason, personal or professional. So, the first outcome is that now you don’t have a regular monthly income. However, due to retirement, you should not suffer due to discontinuation of your job. If you have retired and now you have some important assignment, this assignment will not suffer due to money. There are lenders who offer loans to retired people, called-Loans for the retired, which is meant exclusively for retired people. Such lenders consider your pension as an income, based on which they offer loans to retired people. Even if you are getting disability benefit, it will also be considered an income by these lenders.

If you are a retired person, struggling to manage your debts but you are not sure whether you should go for further loans or not, there are organizations who offer free financial advice to retired people based on their individual conditions. Such organizations include few local age concern groups such as Age concern, national helpline for people of all ages , local citizens advice bureau etc. If you are not able to find such organizations and if you feel lenders do not offer impartial advice to loan seekers, the best way is to visit several lenders who offered loans to retired and based on the advice of several lenders you can easily decide about such loans.

Loans for retired: Loan Amount and Cost

As lenders of loans for the retired consider pensions, disability benefits or any such allowances as your income, the actual loan amount to be offered and interest rates to be charged by such lenders would always depend upon the amount of benefit you are currently receiving. In addition several other factors are taken into account while deciding your eligibility for loan, which include your age, your health status, the monthly payment you can easily make, any other source of income which may include income from savings and investments etc. Therefore, loan amount and interest to be charged by the lender depend upon the profile of the borrower but usually it varies in between £10,000 to £100,000. Once you apply for a loan for retired people, you can get in principle decision within 24 hours. While making application for this category of loan, you have to enclose copies of your pension statements and other documents showing your income, if any from other sources.

So, lenders evaluate the following factors before offering loans for retired people are:

1 Age
2 Amount of pension
3 Any other income such as disability benefit, income from savings and investments
4 Your health status
5 The monthly payment you can easily make.

Many people make the mistake that retirement is only something that older people need to worry about. Unfortunately, this way of thinking can longer be acceptable, because those in their 20’s and 30’s who do not plan for their future now will end up with very little come retirement age. If you engage in planning for retirement now, you’ll be able to rest assured that you can continue to live the lifestyle you’ve always dreamed about. Remember, it’s never too early to start planning for the future, and you want to make sure you have enough to support yourself by the time you can’t work anymore.

The first option when planning for your retirement is to open a Roth IRA. Your current employer may have this option available to you, and you might be able to open one for you and for your spouse. This type of IRA will grow for many years tax-free, and you don’t have to do anything to it. Once you’ve reached age 59 and a half, you can withdraw whatever money has accumulated or leave it there to continue to develop until you really need it. Because you never have to touch the IRA, this type of investment is a great way to plan for the future.

Alternatively, if your company has any sort of retirement fund program you can choose to participate in, it would be wise to do so. Many employers match the money you contribute to your fund, so if your company offers a retirement program it would be a good idea to take advantage of it. These are just a couple of simple things you can do to plan for the future, and if you start while you’re young that gives you more than enough time to build up a tidy nest egg you can live off of when you can’t work anymore.