Four Questions to Ask to Help Prepare to Pay for Your Retirement
By Saghir A. Aslam
Rawalpindi, Pakistan
(The following information is provided solely to educate the Muslim community about investing and financial planning. It is hoped that the Ummah will benefit from this effort through greater financial empowerment, enabling the community to live in security and dignity and fulfill their religious and moral obligations towards charitable activities)
In order to determine how much you will need to fund your retirement, it is helpful to estimate what your retirement budget will look like. These four questions could help you identify your retirement activities to help you plan for the related costs.
- What will I be doing during my retirement days?
- Do I plan to continue working past age 65 or after I reach my full retirement age?
- Full time or Part time?
- Are there hobbies I want to purse that will either cost me money or make money for me?
- Is there volunteer work that may have also costs associated?
- Do I plan to travel?
- Are these things I enjoy doing that have related costs?
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- Where will I be living in my retirement years?
- Will I stay in my current home or downsize to a smaller home or a rental property?
- Will I move to a retirement community or assisted living facility?
- Will I sell my home and replace it when an RV or other alternative living option?
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- Have I thought about potential situations that might occur that will impact my retirement expenditures?
- What health care coverage do I need for my specific health conditions?
- Do I have an emergency fund for unexpected situations such as a health care crisis loss property due to a natural disaster?
- What if I stop working sooner than expected?
- What happens if I experience a significant loss of income?
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- What are the barriers that are keeping me from investing?
- I have nothing extra to invest.
- I have education loans or other debt.
- I don’t know how to start investment plan.
- I have time to start saving later.
Next Steps
Prepare rather than panic. Review the previous questions and create an outline from your answers. The outline will give you the framework to calculate the income you may need to support your retirement life.
Make the decision to adjust your spending patterns today. Choose something that you really don’t and redirect that amount to a savings account. Take advantage of the growth potential over time. Pay yourself first instead of spending money on something that will not support your future retirement needs. Creating that nest egg now could lessen your stress about money.
Start or add to an emergency fund. Even if the amount seems very small, it is important to take the first step. As that amount grows and the behavior becomes a habit you will likely gain confidence and momentum in your investment activities.
Meet with financial advisor t o review your answers and then turn your outline into a plan that will help you work towards your goals.
(Saghir A. Aslam only explains strategies and formulas that he has been using. He is merely providing information, and NO ADVICE is given. Mr Aslam does not endorse or recommend any broker, brokerage firm, or any investment at all, nor does he suggest that anyone will earn a profit when or if they purchase stocks, bonds or any other investments. All stocks or investment vehicles mentioned are for illustrative purposes only. Mr Aslam is not an attorney, accountant, real estate broker, stockbroker, investment advisor, or certified financial planner. Mr Aslam does not have anything for sale.)
