How To Retire At Home
If you’re thinking about how to retire at home, you’ll need to do some legwork to make sure that you’re able to live comfortably. Retiring at home will take enough money to take care of your normal monthly expenses, such as the utility bills and groceries. Also, most people have dreams about retirement activities. You may like to travel, play golf, or spend time with grandchildren. All of these goals require additional funds. To calculate if you have enough money will take a little time and energy, but hopefully, when you’re finished following these steps, you’ll have a clear picture of what it’ll take to retire at home.
What you’ll need:
- Current bills
- Investment statements
- Pension information
- Social Security Information
- List your current expenses. Build a spreadsheet of every expense, including items such as birthdays, anniversaries, and car repairs. These are often forgotten because they don’t happen on a regular basis.
- Think about how these would change when you retire at home. Would you pay more for healthcare? If you aren’t sure, check providers for rates. Would you want to upgrade cable television or purchase more plants for the yard? Your gasoline expenses may decrease, as might the work wardrobe costs. Factor in these changes to find an estimate of your retirement expenses
- Dream. This is the fun part. List those things you aren’t able to do today that you’d like to accomplish if you were retired at home. Find the costs of these dreams and list them below your retirement expenses you detailed in step #2, above.
- List your income. If you have a pension, list this and your Social Security estimate. If you don’t have a Social Security estimate, you may request form SSA-7004-PC, Request for Earnings and Benefit Estimate Statement by contacting a Social Security Administration office or visiting their website.
List your investments. Experts agree that a solid plan is based on using four percent of your investment portfolio as income each year. To find four percent, multiply your total investment portfolio by .04 to find an annual amount you may use for retiring at home. List this under income also.
- Compare. You’ll need much more income than expenses to retire at home to counteract inflation. Remember that although you might have enough money initially, prices rise gradually over time. If you plan on being retired for twenty or thirty years, you’ll need much more income later than you have now.
- Verify your numbers. Many websites on the internet have free retirement calculators. Use the numbers you gathered above to compute the affect of inflation over time on your portfolio.
- Get to work! If you’re short, get moving toward making up the shortage! Cut expenses and increase savings. If you have enough, what are you waiting for? Start living your dream of retiring at home.