So how do you retire comfortably? Having few wants means having your needs met. Stay focused on your goals and use a budget and these suggestions to get started.
Eliminating current debt and doing what you can to prevent reoccurring debt:
Reduce your principal balance by paying extra on your mortgage. Options for paying extra, 1. Make an extra house payment each quarter, and you’ll save thousands in interest and pay off your loan years early 2. Pay half of your payment every two weeks, also known as bi-weekly payments this means you'll make one extra payment each year 3. Round up your payments so you’re paying at least a few extra dollars a month. Downsizing can be an affordable option too. Moving into a home more suited for your needs with lower payments and a shorter loan period will give you freedom and peace of mind.
Preventing reoccurring debt like credit card interest and car loans will keep monthly expenses low and in check. After working on paying down your mortgage principal you should focus on credit card debt and outstanding loans. The same practices used to pay off your mortgage early can be applied to all forms of debt. Make sure to check with your loan providers to ensure there aren't penalties for paying loans early.
Of course it is difficult to give a definitive picture of what retirement will look because everyone's needs vary. I can however offer these suggestions that should at least create a decent idea of how you might fare. The answer comes down to how much annual income you can realistically expect to count on for the rest of your life when you stop working and whether that income would be sufficient to fund a lifestyle you consider acceptable.
The best way to gauge your spending needs is to create a retirement budget which you can do online and eliminate as much debt as possible. Creating your budget will give you some perspective on how to afford retirement. Remember to factor in health care costs, including health insurance coverage, which you'll be responsible for until Medicare kicks in at age 65. After you've created your budget get to work on eliminating reoccurring payments.
"Wealth consists not in having great possessions, but in having few wants." Epictetus