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By Mikey Rox / Len Penzo dot Com
August 2, 2016

Do you have grand plans to spend your golden years lying on a beach, hitting the links on weekdays, or sipping cocktails until the sun goes down? By following a few simple tips you can retire on your own terms — on time, or even earlier — and live the good life.

Take a Financial Selfie

You may be opposed to taking real selfies, but it’s never a bad idea to self-reflect and take a mental snapshot of your finances, no matter how young or old you are.

“The first step to creating a solid financial plan is making sure you understand where you’re at,” says Patty Cathey, an investment advisor with Smart Retirement Planin Denver, Colorado. “Start by looking at all the debt you owe such as student loans, car loans, credit card payments. Then create a list to keep track of your balances, interest rates and payment due dates to make sure you’re not racking up any unnecessary fees. Next, look at all your other expenses: utility payments, cell phone bills, groceries and entertainment. Then compare that against how much you make. If your expenses outweigh your income, you’re going to have to take a hard look at where you can cut.”

Modify Your Plan

If your financial selfie reveals areas that need improvement, modify your current retirement plan to accommodate those changes.

“Revisit and review the plan for any updates, and evaluate assets and debts,” suggests Kevin Gallegos, a vice president with Freedom Financial Network. “Check an online retirement calculator to determine how much savings you’ll need during retirement. Compare where you are with where you need to be.”

Update Your Goals

Your priorities and your finances will change over the years — so you’ll need to adapt.

“Set a goal for where you want to be this time next year,” Cathey advises. “Do you want to wipe out your credit card debt, bring your lunch three times a week, or increase your retirement savings to 10%? Whatever it is, write it down and put it where you’ll see it every day to increase your motivation and the likelihood of reaching that goal.”

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Bring Your Lunch

Speaking of lunch Brown bagging it instead of eating out may seem like a generic and obvious way to save, but the return is probably much larger than you think.

“If you pack your lunch three times a week and invest your savings, you can save more than $9,000 in seven years, if averaging a 5% return. You can also save by cutting down on things like coffee, drinks and movies.”

Meet Your Match

One of the most critical ways to accelerate your retirement savings is to take full advantage of your employer’s 401(k) match program, if they offer one.

“Ideally, you want to be putting away 10% to 15% of your income for retirement,” says Cathey. “If you’re working on other goals, like paying off student loans or saving for a new home or kids’ college, then start by putting enough in your 401(k) to meet your employer’s match. That’s free money!”

Plan Your Lifestyle

Will you work part-time, travel, or pursue a hobby? Create your retirement budget. Then try living on what you anticipate your post-retirement income will be. A good rule of thumb is 85% of current income. Save the rest of your income, or use it to pay off debt.

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Understand Your Future Income

You only get a partial picture of your financial future if you’re basing it on your self-established retirement fund. However, you may be entitled to other payments like Social Security and pensions that will help out in the long run.

You can get an updated estimate of your Social Security income here, and check with your employer’s human resources department to be sure you clearly understand your pension. In addition, review all your investments, including former employers’ pensions.

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Evaluate Life Insurance Needs

If you’re paying premiums on a large life insurance policy, but are no longer supporting dependents, judge whether you should redirect those payments to another source.

Payoff Debt

When should you pay off your debt? As soon as possible.

Paying off a credit card balance with a 15% annual interest rate is equivalent to earning a 15% return on an investment,” Gallegos says. “Plus, you will provide yourself breathing room on a fixed income. If you really can’t pay it off yourself, either by the avalanche or snowball method, then consider debt negotiation or credit counseling.”

Build a Financial Cushion

After you start doing putting the pieces of your retirement together in earnest, you should have a good idea of how much money you’ll need to survive — and, hopefully, thrive. Individuals age 50 and older can make “catch-up” payments, which allow for greater annual contributions. And don’t forget about your safety net.

Build an emergency fund of six — and ideally 12 — months’ expenses in an accessible account,” says Gallegos.