Retiring without a debt is everyone’s dream, but for many people carrying debt into retirement is a reality. There are steps you can take in order to trim your debt in preparation for your golden years. First, retiring without a debt is not always practical or desirable. Some debt may be welcomed if the funds freed up by that debt are used for high-return investments. Reducing the debt and investing for retirement should be happening at the same time. The old adage of paying the high-cost loans first still holds.
Key Takeaways:
- It is important to reduce credit card debt as the first step to preparing for retirement and protecting your savings.
- It is important to pay off loans, and it is critical to start with paying off the loans with the highest interest rates first.
- It is important to realize the importance of your 401(k), and to not dip into it until retirement.
“These tips may help you pare down what you owe, whether you’re just hitting middle age or you’re entering your golden years.”
Read more: https://bettermoneyhabits.bankofamerica.com/en/retirement/managing-retirement-debt
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