Dave Ramsey: 9 Things People Do To Be Successful in Retirement
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Deborah Sabinus
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Levi Leidy
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Retirement is the future for many people, but not everyone will retire successfully. Considering that the average American spends roughly 20 years in retirement, building a successful retirement fund is a habit you should implement and be proud of.
Dave Ramsey, an expert financial advisor who teaches financial management, shares nine successful things people do for retirement. Here are his tips.
Maximize Your Income To Build Wealth
Your income is your greatest wealth-building tool — so use it to the best capacity. This can mean no credit card use and more cash use within your income bracket.
“Living debt-free gives you the freedom to do more with your money,” said Ramsey.
Stick To Your Monthly Budget
Every dollar counts. The most insignificant amounts build up over time, and exceeding your budget results in lost funds that could have been channeled into your retirement. When you stick to your budget consistently, it becomes a habit and you’re forced to only spend money you have previously budgeted for.
“Small everyday choices make the difference in the long run,” said Ramsey.
Invest Into Your Retirement
No matter how old or young you are, putting away some percentage of your income sets you up for retirement later. Ramsey recommends allocating 15% of your income to retirement savings. He found out that many people who invest 15% of their income reach the million-dollar mark for retirement in less than 20 years.
Implement a Long-Term Vision for Investing
Earning from investing is a long game and you shouldn’t expect results right away. Give your investments time to mature and don’t hop from one investment to the other.
Live Below Your Means
It used to be a good idea to live within your means but even better to live below it. Spend less than you make as this leaves you with more disposable income which can be used toward savings or investments for retirement.
Stay Away From Get-Rich-Quick Investments
You may have come across an email promising you huge returns on investments in the shortest time possible. Or donations to access money a nonexistent company is offering you. Don’t be tempted; they’ll cause you huge financial setbacks you’ll struggle to recover from.
“Retirement-savvy folks don’t take huge unnecessary risks with their money. They don’t bet on single stocks and don’t empty their bank accounts to invest in Dogecoin, for instance,” said Ramsey.
Update Your Financial Plan as Needed
Always check in with your finances and make adjustments as big and small life changes come up. Life happens, and you’ll need to change your plans in accordance. For example, if you have a baby you may not be able to save 20% of your income — instead, save 10% until you start earning more.
Work Together With Your Partner
They say two is better than one and in this case, it’s true. Achieving your financial goals for a successful retirement works best with a partner who’ll hold you accountable, helping reach your goal faster. With an extra source of income from your partner, you can reach your goals for retirement savings faster. However, be sure to do this with a financially savvy partner.
Ramsey also advises finding an accountability partner or family member if you’re single.
“You can’t do this alone, you need someone cheering you in your corner,” said Ramsey.
Always Meet With a Financial Planner or an Investment Professional
This is to ensure your financial targets are attainable. You can also get personalized, tailored advice and strategies to win that align with your goals and desires. Also, consult with a financial advisor before making big investment decisions, as your financial well-being is in their best interest.
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