"The core mistake is retiring without true readiness. Retiring with debt is the biggest issue that Ramsey encounters . "You can't have a $750 F-150 payment," he said. "You can't have a student loan that's been around so long you think it's a pet." If you want to retire, get rid of that debt, and it will be much smoother. Otherwise, that debt can dent your income significantly, especially if you let it compound or if that debt carries a floating rate."
"You must set goals before you enter your golden years. Do you want your retirement lifestyle to match your current lifestyle, or are you willing to scale back spending? Do you wish to retire in another country? Do you have any travel aspirations or hobbies you wish to spend liberally on? If these goals are vague and you're going to spend without accounting for the implications, this can lead to failure. This is because without specifics, you can't calculate what you actually need."
Retiring without true readiness is the core mistake. Carrying debt into retirement, such as large vehicle payments or long-standing student loans, can severely reduce retirement income. Floating-rate debt or debt that compounds will worsen with interest-rate hikes and make servicing more difficult. Eliminating debt before retiring will make the transition smoother. Clear retirement goals are essential: define desired lifestyle, potential relocation, travel plans, and hobbies to quantify needed savings. Vague goals prevent accurate calculation of required resources and risk overspending. Honest answers to readiness questions can determine whether retirement will be comfortable or financially precarious.
Read at 24/7 Wall St.
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