How to retire healthier, wealthier and sooner

Between the hustle and bustle of our everyday work schedules, the 9 to 5, the part-time, and the overtime, most African-Americans try to tuck a penny (or two) away for retirement. We scrimp, we save, we pinch, and we even borrow to make sure that our nest egg doesn't crack under pressure. Financially, we want to be as secure as we can, for as long as we can and as soon as we can.

But is it possible?

Yes, it's very possible, according to many finance experts. In fact, most advisors agree that it is not the amount of money that you have, nor the time in which you have to spend it, but how you choose to use it, and more importantly--how you choose to save it. "Retiring early means that you have fewer years to contribute to your retirement savings, and thus, your investments will have less time to grow, and you will use those savings over a longer period," says Jesse Brown, author of Investing in the Dream. "Thus, there is nothing wrong with starting small and gradually increasing your weekly or monthly savings contributions. One of the biggest mistakes people make in their finances is assuming they don't have enough money to save and invest. But the most important point is for you to start saving, to start as early as possible and to save as much as you can."

Making certain that saving is just as important as any other expense requires changing your perception of the role of your money. To invest in your future and retire sooner, make saving your first priority and then handle your expenses, not the other way around.

Most financial experts say you should assume you'll need at least 75 percent to 100 percent of your current income when you retire. If you plan to enjoy certain luxuries, you'll need more than that.

The road to wealth then--the quicker way, that is--is easy, according to Invest in Yourself by Marc Eisenson, Gerri Detweiler and Nancy Castleman. "Spend less than you earn, avoid debt and then save and invest for growth."

You can better prepare for your future by making the right choices. Be sure to: 1) contribute the maximum amount to your employer's retirement plan, 2) avoid borrowing from your 401 (k) plan in order to avoid fees, penalties and loss of savings, 3) open an additional savings vehicle, including IRAs, mutual funds, stocks, bonds, or property, etc., 4) pay your bills automatically to avoid late fees while building your credit record, 5) diversify your investments, 6) review your investment choices quarterly, 7) calculate how much you should save on an annual basis to reach your goals, and 7) seek the advice of a qualified financial planner.

Based on industry trends, social security will not be a vehicle that future generations can readily depend on. "As baby-boomers move into retirement and there is a proportionally larger number of retired people, there may not be enough young people working and making contributions to support the payments that must be made," say Glinda Bridgforth and Gail Perry-Mason, authors of Girl Make Your Money Grow.

For reasons like these, it is essential to map out your retirement needs and the quickest route for getting there. Still, in the midst of your planning, saving and retirement investing, don't neglect the power of rest, relaxation and vacation from the demands of work. "Investing in yourself doesn't mean your pocketbook only, but your mind, soul and spirit," says Brown. "Staying healthy, therefore, is just as important [if not more] as becoming wealthy."

COPYRIGHT 2005 Johnson Publishing Co.
COPYRIGHT 2005 Gale Group