When we think about retirement, we often think that the main factor is a person’s age. That’s simply not true. The truth is that money plays a much larger role in retirement than age does. If you don’t have enough money to sustain yourself without working, you can’t retire.
That’s why there are so many people well into their seventies who still go to work every single day. But knowing whether you’re financially capable of retiring is a tricky thing to do.
You don’t want to retire only to realize that you can’t afford it. We’ll be discussing a few things you need to consider that will help you determine whether you are in the financial position to retire.
Will you still have a source of income?
Many people are under the impression that once you retire, there’s no need for any type of income. Sadly, this is not the case for most people. Unless you have a lot of money saved up, you’ll likely need some form of money to help you cover your monthly expenses.
This can mean having investments, or a retirement fund that pays money out on a month-to-month basis, instead of all at once. In some cases, you may also receive funding from the state or government. While this won’t be enough to live off of, it can supplement whatever you have saved up for your retirement. HelpAdvisor.com has more information about certain services and benefits that retirees can make use of.
Do you have enough savings?
As mentioned, having a monthly source of income is necessary for most people to retire, but the bulk of your money will come from your retirement savings. Whether you took out a retirement policy or just a normal savings account, this is what you’ll use to cover all major expenses. Without any form of savings, it’s unlikely that you’ll be able to retire. That’s why it’s always so important to start saving early.
Do you have support?
You’re going to need a support system when you retire. You need people you can rely on, especially for company and emotional support. But you also need someone who will be willing and able to help you out financially if anything unexpected occurs.
It’s never fun to ask a loved one for financial support, but sometimes it’s your only option. If your children will be taking care of you, have an open discussion with them. If they have babies, they can read this article to gain a deeper understanding of what it means to look after an aging parent.
Can you lower your expenses?
No matter whether you have a source of income or a lot of money saved up, your overall monthly income will be lowered once you retire. This means you need to lower your expenses as well, or else you won’t be able to stay afloat. Making this adjustment can be hard for a lot of people, so you can click here if you need some ideas on where to start cutting expenses.