Ten years might seem too long to plan your retirement — but recent issues in Social Security can make ten years too short. The financial reserves of Social Security may be in trouble by the year 2035. It’s best not to rely solely on benefits when you retire. As early as now, consider these investments that can boost your retirement fund or reduce your spending:
1. Your 401K
Catch up on your 401k contributions by opting to pay the maximum amount. If you are over 50, your company should give you the option to exceed the maximum through catch-up programs. Your retirement fund should abide by the three-legged stool rule — held up by pension from your employers, your savings, and Social Security. Even if your Social Security benefits get reduced (and they most likely will be by 2035), you will still have your pension and your savings to fall back on.
2. Solar Technology
Invest in solar power early on — not through stocks but solar panels. Fitting your house with solar panels can cut your electricity bills to zero or close to it.
With a proper ten-year financing option, you can pay for your panels with the savings you get from your electric bill. Once they’re paid for, you wouldn’t have to worry about paying electricity bills for the rest of your life. Eighty to a hundred dollars a month might not seem like a lot, but multiply that by 25 years, and you would get $24,000-$30,000 that could have been spent making your life more comfortable.
Solar panels will continue performing at peak conditions for at least 25 years (most are warrantied for that period). Even at 35 to 45 years, their performance would only dip by around 20 percent. Unless you’re planning to hit age 100, you will get free or low-cost electricity for the rest of your life.
3. Additional Medicare
Seniors automatically get covered by Medicare — but only for the most basic of services. Medicare (A and B) won’t cover extended stays at the hospital or expenses for prescription drugs. You can get additional coverage by contacting private FMOs that sell extended Medicare options. Medicare C and D are only available through private insurance, and these are the ones that cover your medicine and additional hospital expenses. Extended Medicare also covers dental work, laser eye treatments, and hearing aid purchases, which are non-emergency procedures but can improve your quality of life.
4. Rural Residence
City-living is expensive, while a quiet house in the country can keep your expenses to a minimum. Choose states that are retiree-friendly (no taxes on pensions or Social Security) like Illinois, Mississippi, Florida, or Nevada. Avoid big cities and choose property in rural communities. Rural homes are less expensive, and your property can be a lot bigger than you’re used to. Reduce your spending further by building a garden. You will get fresh vegetables, and tending to the plants daily can help you be healthier.
Retiring comfortably won’t be as easy as it did years ago. With Social Security Reserves running low, you will need to make smart decisions and use the money you have today to shape your life after retirement.