5 Money Moves to Make as an Empty Nester
We offer financing to help cover your plans.
As your children grow up and leave the nest, you may find yourself with more time and financial freedom. The empty nest phase of life presents a unique opportunity to reassess your financial goals and make some strategic money moves. Whether you're looking to bolster your retirement savings, travel the world, or simply enjoy your newfound freedom, here are five money moves to consider as an empty nester.
1. Reevaluate Your Budget:
With fewer mouths to feed and a potentially lower cost of living, it's a great time to revisit your budget. Take a close look at your monthly expenses and identify areas where you can cut back or redirect funds toward your new financial goals. Consider allocating more money to savings, investments, or retirement accounts. Additionally, don't forget to review your insurance policies to ensure they align with your current needs. Download this free budget worksheet, offered by CUNA.org.
2. Maximize Retirement Savings:
As an empty nester, your retirement may be just around the corner. It's crucial to make the most of your remaining working years to boost your retirement savings. Max out contributions to your 401(k) or IRA accounts, especially if you haven't been doing so in the past. Take advantage of catch-up contributions if you're over 50, as they allow you to contribute more than the standard limit. Consult a financial advisor to create a comprehensive retirement plan that aligns with your goals.
3. Pay Down Debt:
If you're carrying high-interest debt, such as credit card balances, consider making a concerted effort to pay it off. Reducing or eliminating debt can free up more of your income for saving, investing, or enjoying your newfound freedom. Prioritize paying off debts with the highest interest rates first, as this will save you the most money in the long run. Once you're debt-free, you'll have more financial flexibility and peace of mind. Not sure where to start, look at consolidating those high interest credit cards into one low-interest payment with a Personal Loan.
4. Invest for the Future:
With the kids out of the house, you may find yourself with extra income that you can invest for your future. Consider diversifying your investment portfolio to achieve your financial goals. Depending on your risk tolerance and time horizon, you may want to explore a mix of stocks, bonds, real estate, and other investment options. Make sure your investment strategy aligns with your long-term goals and consult a financial advisor if needed.
5. Revisit Your Estate Plan:
An empty nest is also an excellent time to review and update your estate plan. Ensure that your will, power of attorney, and healthcare directives are up to date. If you haven't already, consider creating a trust to protect your assets and provide for your loved ones in the event of your passing. Keep in mind that estate planning is not just about passing on assets but also about minimizing taxes and ensuring your wishes are met.
Becoming an empty nester is a significant life transition that can offer financial opportunities and challenges. By reevaluating your budget, maximizing retirement savings, paying down debt, investing for the future, and revisiting your estate plan, you can make the most of this new phase in your life. Remember that financial goals may change over time, so it's essential to adapt and stay on track to achieve the financial security and freedom you desire as you enter this exciting chapter.