How do you plan to spend this holiday season? Purchasing gifts for family? Splurging on an exotic vacation? Or visiting friends in far off places? I am sure one or more of these thoughts would have resonated in your mind when you thought of Christmas. But, have you ever included your retirement savings in your Christmas shopping list? None of us like to be presented with the prospect of disease, disability or death but it is always good to plan ahead and stay prepared for the future. Christmas presents a perfect time to plan for the coming year.
Whether you’ve just turned 18, recently started your professional career, halfway there or have less than 10 years to retire, here are 5 big reasons to include retirement savings in your shopping list this Christmas:
1. A Little Extra Early Enough Could make a Massive Difference
If you are in the age bracket of 18-25, you are sure to spend your Christmas buying gifts for friends and family members and of course the latest bling of the season, would be at the top of your “must-buy” list of festive wear. But wait! If you desire that early retirement, you’ve got to put aside something for your social security.
Make the most of the holiday season and plan your retirement in advance. The sooner you start; the more you will save and this will get you closer to your goal of a risk-free retirement much faster than you think.
2. Use the Spare Time to Review all Your Income Sources
If you think that you still have some 30 odd years to retire and that your retirement savings can wait a while, think again. Most retirement plans take about 37 or more years to achieve maximum returns from retirement plans. Christmas gives you the time to assertively plan your retirement and your social security by reviewing all your income sources by the 31st. December 31st is the time by which you should have evaluated your pay statement to ensure that all your contributions have been deducted including your super-annuation fund and tax-deductible retirement savings.
3. Catch Up if You’ve Fallen Behind
Yes, Christmas is totally incomplete without shopping but be sure to divert that “extra” bonus fund into your retirement kitty. Christmas should not only be about spending, but also about saving especially if your countdown to retirement has begun and you still see yourself falling behind on your retirement savings. Since it is the end of the year, you can get all the facts right and make all the calculations on your current savings. Determine what makes a guaranteed lifelong income after you have made all the provisions for a health insurance protection post your retirement.
4. Final Opportunity to Maximize Your Contributions
The month of December brings you one last opportunity to contribute the maximum 10% to your superannuation fund. If you are a member of an approved retirement savings scheme, you can raise your contributions to 20% of your gross income and reap rich dividends in future. If you have any debts, clear them before you shop for Christmas as this is the best time to give.
5. Plan for a Prosperous Retirement
Once you are fully aware of all your income sources, it is time to plan how you will make your withdrawals in a timely manner. Christmas is the correct time to evaluate all your current accumulations and if they would suffice to fund your existing lifestyle post-retirement. Spend your holidays determining where you wish to spend your life during your golden years and if you have enough to support the biggest transition of your life. This the time to determine if you would need to stay a little longer in the workforce or have enough to retire at the right time.