Retirement Planning For Baby Boomers - 3 Critical Questions Of Temperament And Discipline

By David Skill 

 

Retirement planning looks easy on paper.

Many Baby Boomers go to a financial planner or purchase a retirement planning system and determine how much money they need by a certain date. When you're finished and your plan is documented there is a sense of relief. However, as with all plans the devil is in executing the details.

It takes a lot of discipline and the proper temperament to execute a retirement plan and make sure your document doesn't turn yellow in the file drawer.

Here are 3 questions you need to think seriously about. They can ultimately determine whether your retirement plan will become reality.

Are you willing to live below your annual income level to achieve your financial goals?

This is a real challenge for most American's. For the last several years the savings rate has been at or below zero. In other words, thanks to credit cards and easy credit we spend more than we make.

Excessive spending brings short-term satisfaction at the expense of a lower standard of living in the future. Delaying gratification requires discipline and creating a budget. Following a budget can actually take a lot of pressure off a family. Many people have problems setting limits for themselves. Budgeting puts those limits in writing.

Are you willing to put a large amount of your net worth at risk to fight the long-term effects of inflation?

When it is put that way, of course you are! But how will you sleep at night when you have money in a bear stock market? Are you willing to stay the course when you are losing money?

Frankly there is no other alternative. If all your money is safe in CD's or money markets you are not earning enough interest to offset inflation. The only way to ward off inflation long-term is to put a large portion of your money at risk in the stock market, real estate or other investment vehicles. Historically the returns in these vehicles are superior (in spite of downturns) and will allow you to beat inflation.

What investment vehicle will you use to grow your money?

Once you come to grips with the first two questions this one should be easy. Pick a vehicle you don't mind learning about. If you pick the stock market you don't have to become an expert. Mutual funds and index funds are good investment choices if you don't want to pick individual stocks. However, you need a good base knowledge of the market in order to pick the best mutual or index funds.

If you can give yourself passing marks on all 3 questions you can execute your plan and be successful where others have failed... good luck.

David Skill, a 'Chartered Retirement Planning Counselor' has created an easy retirement system that enables conscientious baby boomers to determine how much money they need to retire. David asks all the vital questions, uses common language and plenty of examples so the participant builds confidence their money will last through retirement and they will not burden their children. Check out >>>>>>>>> http://babyboomerseasyretirement.com/ Article Source: http://EzineArticles.com/?expert=David_Skill