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40-Something and Saving for Retirement? Here Are 4 Tips

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You know that retirement is inevitable yet you find yourself in the situation of the majority who have failed to save enough to quit the workforce comfortably. How did you get to the place of being 40-something and unprepared? The good news is that there is still time to turn things around in the retirement department when you are in your 40s. Here are four tips for saving for your grand exit from the workforce later in life.

  1. Determine Your Retirement Age

You may have to work a few more years than the savvy young person who started saving in his 20s, but there is still enough time for you to make a decision on what age you would like to retire from the job sector. Many professionals decide to hang up their work hat during their 60s and definitely before turning 70-years-old. Your choice on how long you want to work, however, is entirely dependent on your willingness and health.

  1. Save Aggressively

You are technically behind the pact when you begin saving for retirement in your 40s, which is why your efforts must be intentional and consistent. At least 15 percent of your annual income should be set aside for retirement. Many individuals saving for their exit from the workforce contribute 20 percent of their yearly income to such efforts at age 40 and beyond. It is easiest to accomplish your annual saving goals when you set up automatic transfers from your checking account every pay period. All bonuses and should go towards your retirement fund.

  1. Take Full Advantage of Your Retirement Accounts

Many people leave free money on the table at their exit from the job sector because they are ill-informed about their pension plans. You should take the time to learn every aspect of your retirement accounts and contribute as much as you can to them. Also, make sure that you benefit from an employer’s offer to match your contributions if such incentive is available.

  1. Take Out Life Insurance 

In the event that your spouse and dependents rely on your income to live, it is important that you are covered with life insurance. By taking out a policy, you can be sure that if anything were to happen to you prior to retirement, then your loved ones would still be able to live comfortably.

  1. Decrease Debt

There is little point in you maxing out your retirement accounts and saving like crazy if you maintain debt that will follow you into the golden years. Consider paying off large accounts before you begin saving aggressively so that your frugal efforts can be of greater use to your overall plan.

Living a minimal lifestyle is essential to those getting a late start in their retirement savings. You cannot be a 40-year-old big spender working a traditional job and expect to have $2 million saved when retirement comes. Sacrificing your desires and only spending money on necessities is the best way to prepare for your grand exit from the workforce.

Staying healthy and active in your retirement

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Gardening

At the end of a lengthy and often difficult working life, most people look with glee towards enjoying a long and fruitful retirement. However, superannuation may not always deliver all that it promises, so it is vital to approach this stage of one’s life with a clearly defined strategy for maintaining health and wellbeing. Those who fail to prepare do so at their peril.

Health problems

Indeed, a whole range of health issues may await the unsuspecting senior citizen who has not planned ahead for retirement. Blood vessels may become less elastic and hard, fatty deposits may begin to cling to the arterial walls. This puts the newly retired senior citizen at risk of developing high blood pressure or angina and makes a heart attack more likely. The digestive system might be affected, with the kidneys and bladder functions possibly degenerating, leading to constipation, Irritable Bowel Syndrome or incontinence. Meanwhile, the bones, joints and muscles begin to degenerate. Muscles have a marked reduction in flexibility and strength, and bones become less dense. Senior citizens have a greater risk of arthritis, fractures and osteoporosis. Eyes must also be regularly checked and monitored to avoid glaucoma and macular degeneration. Furthermore, insufficient attention to diet can cause type 2 diabetes.

Keep active

Little wonder, therefore, that the retirement home market now focuses on the wellbeing and health of the senior citizens. They encourage their retirees to realize the health benefits of remaining active, and this is not as difficult as it sounds. In fact, 30 minutes of brisk walking each day burns the same calories per mile as running, but puts a lot less strain on the body and can lower the risk of heart disease by 30 percent. This can be achieved by walking to the shops instead of driving, or those who enjoy gardening may try to keep their cardiovascular system in good condition by digging, weeding and cutting the lawn.

Elderly couple courtesy of flickr user Zadi Diaz (Creative Commons)

Elderly couple courtesy of flickr user Zadi Diaz (Creative Commons)

Alternatively, seniors may wish to take up a sport in their retirement; there are considerable health benefits for those who play golf, join a dance club, go hiking or cycling. Retirees could swim regularly; indeed the local leisure center can actually become an important social meeting place, where like-minded people may meet and benefit from fitness and nutritional advice given by the skilled staff. Keeping active will help to increase fitness levels as well as improving the immune system and concentration levels. 

Nutrition

For most people, a long and healthy retirement could be more attainable if they followed some simple guidelines on nutrition. Senior citizens can positively impact their health by eating plenty of fresh fruit, vegetables and oily fish, while reducing intake of caffeine, sugary drinks, tobacco and alcohol. Dehydration can be avoided by drinking around eight glasses of water a day.

Senior citizens could also consider further education as a way of keeping their minds active; learning a language, an instrument or other new skill can be the key to maintaining an active mind while providing hours of enjoyment.