I’m a big fan of financial planning. Whether it’s for retirement or just to achieve a particular short-term financial goal, I think that preparing for and executing a well-drafted financial plan is a great thing. However, sometimes that’s easier said than done. But while planning for retirement can be especially difficult, it can be even harder when life gets in the way.
And if your family is anything like mine, life can get in the way easily and often. Here however, are some of the ways that we continue to persevere in our retirement planning even when life trips us up a little bit.
Financial requirements that require immediate attention
From kids and college planning, to home buying, vehicle repairs, and financial crises, it seems like there is a never-ending procession of financial hurdles we have to jump. First there was the birth of our first child, then the financial crisis and ensuing recession hit, then we bought our first home, then came the sale of that home (a huge financial loss) followed by several moves and finally the purchase of our next home, and then came a second child. All this was of course interspersed with things like home repairs, job changes, kid costs and doctor bills, and all those other little — and not so little — financial responsibilities vying for our attention and our money.
With all that, how were we ever supposed to cut a little portion off the financial pie to sink into retirement planning?
Even a little bit can add up
Don’t get me wrong, I’d love to be able to throw a couple grand at my retirement savings on a regular basis, but then there is reality, and with that reality comes the fact that sometimes costs may exceed income. But this doesn’t necessarily mean all is lost when it comes to retirement planning. This is when it can be important to realize that putting even a little something away can be better than nothing. Whether it’s pocket change and dollar bills, just sticking $50 in the bank or retirement account, or buying an ounce of silver at the local coin shop when we’re out and about, over time these amounts can add up.
At just $600 a year ($50 a month), compounded annually at 3 percent over 30 years, these small amounts can accumulate to over $28,000. And being able to keep the ball rolling while waiting to interject those larger amounts — income tax refunds, work bonuses, or whatever — in between, can keep our retirement planning momentum moving forward even when life gets in the way.
Maintain goals, but making necessary adjustments
Just because life gets in the way doesn’t necessarily mean you have to give up your retirement goals completely, they might just need a little tweaking. When I was still single — and even once I wasn’t — my financial and retirement goals have changed from what they are now that I have children. This doesn’t mean that they are different, but maybe they just aren’t as super-sized as they once were.
Take for example my goal of early retirement. Rather than change my age, I changed my career. In this way, I assumed a career that I enjoy, which allows me in many ways to already feel like I’m retired, yet will allow me to continue to work (hopefully) well into my latter years. Another example might be our goal of homeownership and becoming mortgage-free well before retirement. While we obtained the goal of homeownership, we eventually changed the goal of owning a single-family home in order to be able to downsize, thereby riding ourselves of a mortgage, cutting our home-related costs from an average of about $2,300 a month to near $800, and strengthening our position moving forward toward retirement.
In these ways, we continue to plan for retirement even when all those things that can come along with living a fairly typical existence come into play.
More From This Contributor:
Building a Revenue Producing Blog
How I Differentiate My Blog
Preparing to Publish My First E-book
The author is not a licensed financial professional. The information provided in this article is for informational purposes only and does not constitute advice of any kind. Calculations have not been verified by a professional. Any action taken by the reader due to the information provided in this article is solely at the reader’s discretion.