Would you like to make your dollars go farther and increase how much you save?
Most people would. According to a recent survey conducted by the Employee Benefit Research Institute, only 51% of Americans are confident they will have enough money saved for retirement. 28% are not at all confident, while 21% are not too confident. Fortunately, simplifying your finances right away will help you save more for the future as well as make sure your money lasts longer during your retirement.
Take a look at your bank accounts.
According to Bankrate.com, it has become normal for a family to have six or more bank accounts. However, while you probably need a checking account, a savings account will offer little value in a low-interest environment. Multiple accounts that serve the same purpose are also inadvisable because the associated banking fees tend to add up. Some banks charge up to $420 per year just for the privilege of banking with them so eliminating unnecessary accounts and shopping for products with lower fees are great ways to save.
Take a look at your credit cards.
According to CreditCards.com, 27% of Americans over the age of 50 had four or more credit cards in 2012. In 2011, 21% of bank credit cards required annual fees creating an opportunity to find cards that don’t charge fees. If you don’t need all those credit cards, consider closing some of your accounts. We also recommend retirees avoid credit card debt like the plague. Having fewer cards mean less temptation to use them. However, if you feel that you must keep some credit, look for a card with a low-interest rate, $0 annual fee, and a high-quality perk such as cash back for purchases.
Take a look at your insurance.
The need for insurance changes regularly with life events be they buying a home, getting a big promotion, having children, or even suffering a loss. Evaluate all of your insurance policies regularly to make sure you’re properly protected without being over-protected. From auto-insurance to home insurance, paying for more insurance than you need is costly and won’t help you during a claim. For example, while it may feel good to insure your property for $300,000, you’re only wasting money you could put to other purposes if you’re paying for that level of coverage on a home that’s really only worth $250,000.
Simplifying finances helps you increase your savings potential and the discipline will also help stretch those dollars during retirement. As a bonus, you will save a lot of time by reducing the number of credit cards payments to make or bank accounts you have to balance. As with any financial situation, take advantage of your financial advisor and insurance professional’s insights. Be sure you challenge them to help you obtain the most important discounts while reducing your overall costs. Both should be happy to help.
