The ultimate goal of financial success should be on the mind of every entrepreneur. And what does financial success mean? Retirement, of course! Here are some specific tools that every entrepreneur should need as they get ready for retirement, even if it’s a long way off.
Tax-Advantaged Accounts
Certain kinds of savings accounts have certain advantages that are perfect for retirement savings. Some, as a matter of fact, are even meant specifically for retirement. The good thing about tax-advantaged accounts is that they allow you to temporarily forego paying taxes on your account deposits until retirement. You can save up enough for your retirement and taxes, and then dive in headfirst. On the other hand, tax free savings accounts are just that – tax free, before and after retirement. Depending on the account, there might be other special privileges granted, like tax-fee interest. Talk with your bank and do the research necessary to know which kind of tax-advantaged or retirement savings account is the one that will work for you.
Life Insurance
If you get the right kind of life insurance, it can also help you save for retirement. The life insurance option that is generally cheaper is term insurance, which means that you purchase insurance for a given number of years (usually a decade or two). It tends to be several thousand dollars less than a life insurance option that is guaranteed for a lifetime. This can be good for retirement for a couple of reasons. First of all, a tragic accident before a finished retirement would still render sufficient funds to support your family. The revenue that has been freed up from the cheaper life insurance option would also let you put more into retirement. Some policies let you convert a portion to pay for long-term care expenses.
Follow a Safe Retirement Plan
At the end of the day, no tools are going to help you if you don’t have the discipline to put your money away. Consistent savings can be especially difficult as an entrepreneur since your income may or may not be steady. You also likely will not have a retirement plan that stems from employee benefits of a given company, like a 401(k). That is all the more reason it is so important to commit to good saving habits now, and to not deviate from them no matter how tempting.
Talk to a financial professional who can advise you how best to plan based on your exact situation and entrepreneurial field. Be prepared and put in the effort required. If you are aware of the resources available to you, and you act responsibly, you should have no problems whatsoever.
Click here to learn how to turn your passion into a career!