Strike A Balance: Save For Your Retirement
“I should try the new Chinese restaurant tonight. Isn’t it too pricey? Whatever, I can treat myself once a week right? Or not? I think eating at home and saving seems a better option…. Think think…”
This inner battle is experienced by every one of us frequently. The desire to prepare and then enjoy savings in the future, versus the temptation of living the life at present and cherish what we have today. It is the universal truth that nobody is promised tomorrow. However, nobody wants to live their retirement years with limited choices, this is also a fact.
The question arises, how you can strike a balance between spending on a valuable life experience today and saving for comfortable lifestyle in future. By following this four-step plan you can balance between these two objectives, which is living rich while still saving for the retirement.
- Understand Your Spending:
Your savings for the future can be highly affected by simply understanding your current spending habits and patterns. Check your weekly expenses rather than monthly review as it is easier to catch where u may have spent more than you originally planned because in today’s market driven, fast-paced world, money is spent easily without even realizing it.
- Think Long And Hard About Your Decisions:
You should be clear in your decisions about what you want to do and what gives you more happiness and satisfaction in the long term and short term before getting in a situation where these decisions are made for them. Strolling around a park on a Saturday afternoon instead of going to city mall and spending is a good alternative. Anything which you will buy from the mall will soon fade out but, a person you meet or a beautiful memory you make at the park will be a much richer experience. Learn to make your decisions and stop depriving yourself from what you truly want.
- Plan For Money Buckets:
Make your buckets of money. The buckets can include current expenses, college funds, savings (for a new home, a new car, a trip to Europe), retirement savings, etc. This concept can help you succeed in setting up multiple savings for your specific goals while you save for retirement as well. With the help of your financial planner, estimate the funds needed in each bucket and then go with the plan. Over time, you will be rewarded with each bucket when it will be needed.
- Build A Small Portion For Spontaneity:
Findings show that many people don’t track their spending habits because then they go under financial pressure and stress. This can be resolved by keeping a small portion from your income solely for spontaneous spending and spur of the moment decision. It may sound conflicting but in truth this helps in protecting your savings. When you know that in your budget, a certain amount is there just for spending it, it safeguards your big amounts that you are saving in other accounts.
To prepare your financial freedom and security in the future, your today needs to be balanced by cutting back on extra spending, improving your savings, and investing correctly to maximize your financial stability. The good news is doing this is possible because making out the best of your time today is not always need to be expensive. Spend on rich experiences, which are most meaningful to you rather than material things. Sometime later, when you will be in your retirement days, not only you will have enough retirement funds but also, a rich network of loved ones with whom you had shared your precious lifetime.