Not affiliated with The United States Office of Personnel Management or any government agency

Not affiliated with The United States Office of Personnel Management or any government agency

Dealing With Debt For A Happy Retirement

If you find yourself still struggling with loans and credit card payments now that you’re approaching retirement, you’re not alone.  With an average debt of nearly $40,000 in older households, America is still adapting to changes in life expectancy and the effect that this is having on working lives. This also means that retirement isn’t the end of life that it used to signify just a few decades ago. It’s not too late to make preparations for your retirement. Many people live long and happy lives after they stop work and it can still be a fruitful time for you if you manage your money well.

Take stock of your money

Start by assessing your finances and making the best of what you have. If you have been in real financial difficulty in the past, you might want to set aside a separate account that isn’t subject to Chexsystem. This will keep safe money that you will always be able to access for emergencies or basic living expenses, even if all your other assets are frozen. Once you have secured a safe account, make a plan for the future that avoids any further problems that could affect your credit score.

Minimize your debts

If you own a house, consider increasing mortgage payments before you retire. If that’s not possible, think about downsizing now before you stop working. At the very least, this could save you money each month and it could mean paying off your mortgage entirely, freeing up more cash for your retirement. Look at other assets too and cut back on any that you can’t afford to keep. Unless for business use, there is no tax relief on a car payment plan, so swapping to a more affordable option that you can purchase with cash makes sense.  If you must take out a loan, make sure it’s timed to end when you want to retire. Pay off credit cards with the highest interest rate first or consolidate to a card with a lower interest rate to make one easy payment every month.

Lower your expectations

You may have had great plans for your retirement and, no doubt, being in debt was not one of them. Try not to dwell on the past but learn from financial mistakes. Struggling to pay bills is the reason most Americans give for not saving more and this means that over 40% of Americans have less than $10,000 saved for when they retire. Be strict with your budget now, work as much as you can while you are able and secure what savings you do have for emergencies. Although there is insecurity about the future of social benefits, for now, they do provide a steady income. You can claim from the age of 62 but the longer you delay before taking any money the more money you will receive each month.

Taking steps to simplify and stabilize your finances, no matter what stage you are at in your life, can bring significant rewards. If you are lucky enough to live a prolonged and healthy retirement, as long as you are sensible with your money, you should still be able to relax and enjoy it without financial worry.

Search for Public Sector Retirement Expert.

Receive the Best advice.

PSR Experts can help you determine if Public Sector Retirement is right for you or if you should look for alternatives.

The Best Advice creates
the best results.

Recent Articles

Blending Civilian and Military Benefits: How Federal Employees Can Get the Best of Both Worlds

Key Takeaways: Federal employees who qualify for both civilian and military benefits can leverage unique advantages to maximize their financial...

Making Your Military Years Count: The Little-Known Perk That Can Supercharge Your Federal Pension

Key Takeaways: Military service can boost your federal pension: By buying back your military time, you can add those years...

Law Enforcement Retirement Benefits: What Officers Should Consider Before Calling It a Day

Key Takeaways Law enforcement officers (LEOs) benefit from unique retirement plans, but timing, pension calculations, and potential supplements are critical...

Search For Public Sector Retirement Expert

Receive the Best advice.

PSR Experts can help you determine if
Public Sector Retirement is right for you or if you should
look for alternatives.

The Best Advice creates

the best results.

Subscribe to our Newsletter

"*" indicates required fields

Our Readers Deserve The Best PSHB and USPS Health Benefits Guidance

Licensed insurance agents who understand PSHB, Medicare, and USPS Health Benefits Plan are encouraged to apply for a free listing.

This field is for validation purposes and should be left unchanged.

Book Phone Consultation

"*" indicates required fields

This field is for validation purposes and should be left unchanged.

Get In Touch

Stay up to date on the latest information about Public Sector Retirement.

The Best Advice Creates The Best