Finances seem to be on the top of everyone’s mind lately.

I hope to bring you some information that will help you look into your finances and make a plan for your future.

Many of us struggle with our finances and are not exactly sure what to do to save for our future. While it is good to receive retirement benefits from a company you work for, many times that is not enough to get us through in our later years. It would seem that social security is definitely not enough to live off of when we retire. The problem is, how do we take money out of our everyday budget to put aside for 30, 40 or 50 years from now?  We have to pay the bills we have right now and survive now, don’t we?

When you have a goal and write it down, you are more likely to work towards it and achieve it.  Finances are the same way. You start by having a goal, make it into a plan and document it.

Make a plan.

Answer these questions:

What is your plan for the future?

How much money do you believe you need to live comfortably each year?

What do you want to have as an income when you retire?

What do you want to be able to do when you retire? (travel, buy a vacation home, etc)

What age do you want to retire?

Knowing the answers to these questions can help you prepare goals and plan for your future.

The next step is to do the math.

How much do I need to set aside for retirement?

A good rule of thumb is to put away at least 10% of your paycheck into some sort of retirement account. As you increase your earnings, you will want to raise the retirement fund to 15% of your earnings.

What if I have an emergency and need some of the money I saved for retirement?

Financial Peace University recommends having an emergency starter fund of $1,000. I would recommend setting aside 5 to 10% of each check to be put into your savings account to have for emergencies. As you get used to saving you should continue to add money to your emergency fund to help replace partial income in case a bigger emergency occurs.

Where to invest money for retirement?

Now, it is time to invest your money into a retirement fund.  Search for the best retirement account that fits your needs. IRA’s (Individual Retirement Accounts), which include choices of a Roth IRA and a Traditional IRA, are some examples. IRA’s allow you to contribute your money to your retirement on your own. 401K plans are employer-based plans and you can only contribute a certain amount to these plans specified by your employer. If your employer offers a 401K plan, definitely take advantage of that and use the IRA contributions to increase your retirement in a different way. Mutual funds are another choice many make for retirement investments. It is important to have different types of investments and to diversify your money.

Once your IRA is set up, you can set up automatic payments from your bank account to contribute each month, hassle-free!

Coming soon!

Need some more motivation regarding Finances? 

New post written by Keanu Taylor, freelance writer, aspiring financial advisor, and owner of KeanuTaylor.com.

Keanu will write about encouraging words relating to money verses and analysis to help motivate you to take control of your finances.