Dreaming about retirement? Keep these factors in mind!

Is retirement fast approaching, or does it still appear to be a distant point on the horizon, especially if you are young? Nevertheless, it's always a good idea to prepare for this stage of life, characterized by significant changes in your personal circumstances, no matter how far off it may seem.

When you stop working, your income can take a big hit. So, getting ready for retirement can help you steer clear of money troubles when you're no longer on the job.

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According to the Center for Retirement Research at Boston College, more than one-quarter of U.S. households might be overestimating their retirement savings.

Professionals advise sticking to an annual withdrawal rate of 3.5% to 4% from your retirement savings, though this might require tweaks based on your specific circumstances. Also, think about cutting down on non-essential expenses, like dining out or hefty car payments, to strengthen your retirement funds.

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If you're nearing retirement but haven't saved enough, the ideal approach is to devise a strategy to boost your income during retirement. This could mean extending your working years beyond your initial plans or maximizing your Social Security benefits by postponing retirement until the age of 70.

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One thing to keep in mind if you are a homeowner, is that retirement often coincides with the end of mortgage repayment, which greatly reduces the weight of housing-related expenses in the budget.

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It's crucial to plan for medical expenses and long-term healthcare, as these costs can become substantial during retirement. To make sure you're making progress toward your retirement savings target, you can also employ a retirement calculator tool.

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These tools consider your current age, retirement age, and income goal to help you determine the amount you should save to reach your objective. This can offer you a clearer picture of your current situation and what steps you should take to remain on course.

It is also vitally important that you don't forget to keep all the documents necessary to establish your pension: employment contracts, pay slips, sick or parental leave compensation, unemployment benefits, etc.

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Undoubtedly, the best thing you can do to prepare for retirement is to ensure your funds are in order. After all, with reduced income, changing budgets, and new needs, there are many reasons to anticipate your financial situation and expenses. However, money worries are not the only thing you must consider when preparing for retirement.

Retirement also poses health challenges. While we can't dodge all health issues, it's smart to follow some good habits: keep up with regular check-ups and stay active with some exercise.

It is also important to keep your mind active after retirement. Think about how you would like to spend your retirement. Many retirees become depressed once they stop working because they feel they lack purpose.

Whether you decide you want to travel, help out with the grandkids, join a club, learn a new sport or musical instrument or volunteer your time with a charity organization, it is important to think about these things before you retire so you can plan for them.

You should also plan for ups and downs. You may feel slightly lost in the beginning after you retire and that is totally normal.

If you live with a partner you may also experience some tension or conflicts if you are not used to spending all day with each other. It is important to be open and talk to your partner about these things so you can establish a routine that suits you both.

It is okay to enjoy your alone time, and to request time alone to do your "own thing" away from your partner. However, retirement can also be a wonderful time to rekindle the spark, so don't isolate yourself too much!

Finally, it is so important to learn new things and stay flexible. Nobody wants to become a grumpy retirees who only criticizes the younger generation. Try to keep an open mind and keep with the times, learning with keep you young after all!