In our practice, we are often asked questions about appropriate debt levels for retirement planning. The easy answer is zero. But, it’s often a little more complex given the financial strains caused by the recent economy. As a result, many Americans carry quite a bit of debt. If you are one of them, you should take debt reduction seriously when planning for your retirement years.
It can seem as though saving money is the most important thing, but there are different ways to go about it. If you were to put money in a low-yield savings account while you are in significant credit card debt, you may be putting your money in the wrong place. Paying down high interest debt is the far-better option.
We live in a society that, in many ways, encourages instant gratification. Sometimes you have to make hard but intelligent choices, including keeping a conservative outlook when it comes to making purchases. Going into debt to obtain something that you really don’t need is going to delay any progress that you may be able to make toward feathering your nest for retirement.
Your mortgage is another thing to consider. You can pay more than the mandatory monthly payment each month over an extended period of time and wind up paying off your mortgage early as a result. This can pay huge dividends as you start to see your retirement years appear over the horizon.
These are some things to take into consideration if you are serious about being able to retire someday. Should you be interested in crafting a plan that leads to financial freedom during your senior years, don’t hesitate to pick up the phone to arrange for a consultation with a good Oklahoma City retirement planning lawyer.
Larry Parman
Author, President and Founding Attorney
Parman & Easterday
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