Northwestern Mutual: 4 Things to Do 20 Years Away From Retirement
NEW YORK, June 10, 2024 (Newswire.com) - Retirement may seem like a distant milestone for people in their forties, but it's never too early to start planning. Early decisions can significantly impact someone’s financial security and lifestyle in retirement. Here are four steps for professionals to take when they’re two decades away from retiring.
Reassess debt
Debt can be tough to manage after retirement, so most professionals aim to be debt-free before they retire—of course, this is not the same for everyone. Depending on an individual’s financial situation, it may make sense to retire with some debt.
Regardless, getting a clear picture of one’s current financial standing is helpful. Take stock of all debt, including credit cards, student loans, and mortgages. Professionals may decide to create a plan to pay off high-interest debts first while maintaining minimum payments on others. By reducing debt early, it’s possible to free up more money for retirement savings and ensure a smoother transition into retirement.
Make budget updates
As life circumstances change, budgets should, too. Periodically revisiting their budget allows professionals to make necessary adjustments and stay on track toward their retirement goals. Budget updates should often accompany key financial milestones like receiving a big raise at work, becoming a parent, or taking out a mortgage. And, since many people in their thirties tend to fall prey to lifestyle creep, the forties can be a good time to reevaluate expenses and look for opportunities to save more without sacrificing quality of life.
Envision retired life
Retirement isn't just about financial security; it's also about enjoyment. Professionals should take some time to envision their ideal retired life and set concrete goals for retirement. Some people want to travel the world or retire overseas; others want to pursue hobbies or spend more time with loved ones.
Having a rough idea of what retirement could look like reminds people of what they’re looking forward to but also helps them figure out what expenses will look like after retirement. Consider the future while making financial decisions and prioritize actions that align with those retirement dreams.
Reevaluate life insurance
While retirement planning often focuses on individual goals, it's important to make sure the needs of loved ones are taken care of. 20 years away from retirement is often a good time to reassess life insurance coverage and ensure that it meets current needs, whether due to an expanding family, increased salary, or other changes. This can also be the right time to consider a permanent policy like whole or universal life insurance that offers lifelong protection and a guaranteed payout to loved ones.
Northwestern Mutual is the marketing name for The Northwestern Mutual Life Insurance Company (NM) and its subsidiaries in Milwaukee, WI.
Contact: Don Klein, 1-800-323-7033
Source: Northwestern Mutual