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Step 1
Set into motion a plan for your retirement years. Do the plan once you start a career. Start your savings plan the first day you start to earn money. Once you start a career,check with your Human Resource office to ascertain what amount, if anything, the firm will contribute to your retirement fund. Find out what is the maximum that you may contribute and sign up immediately. You will not be taxed on this money.
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Step 2
Go to the IRS website. Once there, look for your tax bracket and check the non-taxable dollar amount that is applicable for retirement funds. Try your best to put that amount of money aside each year (see Resources below).
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Step 3
Plan on paying off as many of you debts as possible prior to retiring. Make a 5-year plan 5 years before your planned retirement date. As you pay off a credit card, double up on another bill to bring down your balance and pay your bills off. You have to remember that in many situations when you reach retirement, you will be receiving anywhere from 30 to 80 percent of your previous take-home pay.
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Step 4
Attend a pre-retirement seminar. Many are held at local libraries and through your work. It is wise to plan to attend one of these seminars to obtain a better grasp of what your financial future will be like.
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Step 5
Plan on setting an appointment with your Human Resource office at least 5 years prior to your planned retirement date. Obtain information on what the firm will offer you when you retire, such as health and life insurance coverage into your retirement years, and a rough estimation of what you will be taking home from your retirement package.
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Step 6
Note all of your standard bills--gas and electric, water, insurance, car payments, mortgage, food, entertainment and other bills--that may occur each month. After you have made your list of expenses, check that against what your Human Resource office gave you as a pre-retirement plan. This comparison will allow you to look at what you have to lay out each month compared to what you will be bringing in each month. Your objective is to have enough money through your retirement plan that you do not have to get a part-time job to make ends meet.
