Money at Every Age
By Nick Neukirch, Legacy Financial Strategies, LLC
However, knowing where to start and what to prioritize can be overwhelming. Below are some tips to help you on your financial journey:
Your 20s Although you may be focused on paying off student loans, don’t neglect to take advantage of contributions to retirement accounts as well—many of which are pre-tax. This is especially important if your employer offers a match because this is essentially free money for you. If you do not have an employer retirement plan, you have plenty of other options to save for retirement, such as opening an IRA. Even just contributing one percent of your paycheck will have a lasting impact on your future.
Your 30s It may seem unusual to think about death when you are in your 30s, but you should start looking into obtaining life insurance, especially if you have a family and own a home with a mortgage. It is much easier (and cheaper) to get life insurance when you are young and healthy, than if you delay
Your 40s With college on the radar, many parents would like to contribute as much as possible toward their children’s education costs. However, although it might seem counter-intuitive, prioritize your retirement before giving your children tuition assistance. Remember there are no loans for retirement, but there are for education.
Your 50s Financial dreams, such as buying a vacation home or moving to a larger home, can become a reality for many in their 50s. Before you buy, consider how making that big purchase will impact your ability to retire successfully. To understand your impact, know how much you want to save before you retire, taking into account how inflation will affect your savings as you age. Your 50s are also a great time to take advantage of catch-up contributions to your retirement accounts.
Your 60s Once you turn 60, create a social security strategy that will work with your personal situation. Although 62 is the age you are able to begin receiving social security benefits, many don’t realize that by receiving social security early, your monthly benefit will be reduced significantly. Alternatively, if you delay disbursements, you can increase your monthly benefit
Your 70s Now that you find yourself enjoying retirement, you might think you don’t need to worry about financial planning anymore. Wrong! Your 70s is the time to make sure you are taking out the right amount of money from your savings—enough to enjoy your hard work, but not so much that you risk running out. It is also time to reflect on the legacy you would like to leave for your children, grandchildren and community.