We all want to retire comfortably. After working for so many years to support the family and our little quirks and expenses in life, we all deserve to live the last years of our lives in peace. Unfortunately, that is not the type of retirement that the baby boomers are facing. If you did not know, they are the generation who are about to retire or have already retired.
The problem lies in the mounting debts that they owe. From mortgages, to student loans and credit card debts – all of these are painting a dismal future for our elders. Couple that with the rising cost of living and the high medical fees, you would think that seniors have no choice but to work till they drop.
With only a few years left till they retire, what can they do to help salvage the dream retirement that they were aiming for?
Fortunately, debt management is a solution that they can use to get out of debt. Most of the time, debt is the anchor that drags them down. If this is eliminated, they have a fighting chance of living a decent lifestyle.
The great thing about debt management is it can get you out of debt in 5 years or less – at least this is true for credit card debt, medical bills and other personal loans. It does require a steady job so you can afford your payments though. So you need to start with this as soon as possible. The idea is to remove the high interest debts so you can allocate your other funds towards any mortgage or student debt that you owe. If debt will really overlap with your retirement, make sure that you are able to pay off a significant amount before that happens.
With debt management, you will be assigned a debt counselor who will provide you with expert advice about your money. You want to make sure that you learn as much as you can so that you will no longer be placed in another debt-ridden situation. The counselor will help you come up with a debt management plan that will contain all the debts that you owe and the money that you can afford to send to it every month. It doesn’t matter if it is a low amount. Your debts will be stretched over an extended payment schedule. The counselor will approach your creditors and negotiate your plan. If they approve, you will send the total monthly payment to the debt management company who in turn, will distribute your money to the different creditors based on your plan.
Since your monthly contributions are lowered, there will be freed funds from your budget. Put that amount into your retirement fund and do not use it unless it is an emergency.Be very strict about this – unless of course, you want to continue working for the rest of your life just to finance your basic needs.
Retiring with debt can be scary so while you are still working, it is best for you to act on solving your financial crisis immediately. Do not wait until the last minute as it might be too late for you already.