The Best Ideas on How to Make a Good Retirement Plan

The Best Ideas on How to Make a Good Retirement Plan

Having a good retirement plan is a must. The key to a long and happy life after we quit our jobs and head into retirement lies in timely saving and preparing of funds. A lot of young people live their lives without giving a single thought to a proper retirement plan. They might just be trying to survive the upcoming tax season or to invest their money in shares that seem to be going up – and all that is great. But one also has to plan long-term and never forget about the makings of a good retirement plan.

If you see yourself living a comfortable and relaxing life while lounging on Florida’s beaches, now’s the time to do something about it! In fact, saving for retirement should happen in all stages of life as, hopefully, you are going to spend decades in retirement and you are going to need sufficient funds for it.

Saving for retirement happens in 3 stages

When we are young, we tend to leave everything for the last minute. After all, we feel like we have all the time in the world, which is why we are often falling behind with the things that matter most. And once you enter a stage of your life when you will start running out of time, you will realize just how important it was to save your money and have a good retirement plan on time.

  • Stage number 1 – Ages 21 – 35 (young adulthood)

If you wanted to label the perfect time for starting your retirement fund, this would be it. Young adulthood is when you have a lot of time to plan, organize, and start putting some money away. And since the golden rule is that the more time you have, the more interest you will earn, it would be good to start planning for the long haul and invest your money in a retirement plan.

  • Stage number 2 – Ages 36 to 50 (early midlife)

This is a crucial point in the lives of many people. You are still far too young to be looking into relocation tips for elderly people for moving into your retirement nest, but you are also at a period in your life when the high time for some serious savings will come. There will only be one problem – you are going to have several financial burdens. From medical and credit card bills to student loans and mortgages, putting aside a lot of money for your retirement plan might be a challenge.

  • Stage number 3 – Ages 50 – 65 (later midlife)

You can already imagine that, by this time, you won’t have a lot of time left for saving for your retirement fund. But you will have some things working on your side! The later midlife is the time when people reach the maximum in their careers, which leads to higher incomes. Also, by this time, you will have paid off all of your debts – or at least a large portion of it. These two combined will leave a lot of room for growing your savings.

good retirement plan

Makings of a good retirement plan – your best options

What all people who start saving up money for a good retirement plan early on find out is that, luckily, you have many options. But having so many options might make it difficult to choose only one option. Our suggestion? Assess your needs, incomes, goals, and plans for the future, and choose the best option for you. One thing is for sure – as soon as you start working, saving for retirement should be one of your financial habits as an adult.


When most people hear the phrase makings of a good retirement plan, their minds automatically wander to pensions. Even though pensions are less popular nowadays, they are still fairly common and typical for government jobs. In essence, an employee works and is minimally involved as the employer contributes the money on your behalf. You work, and you collect your pension when you retire. If you are looking for an option where you won’t have to be involved, then pensions are perfect for you.

Defined contribution plans for good retirement plan

Perhaps the most widespread retirement plans, defined contribution plans are today offered by most employers. You will be able to find four primary contribution plans which we assume you are already fairly familiar with:

  • 401k
  • 403b
  • 457
  • TSP

In essence, if you choose defined contribution plans, you choose the option that works best for you and you decide how much you want to contribute. The good news is that many employers actually match the contributions their employees make. However, don’t take this for granted! It depends on every employer individually.

Individual Retirement Accounts (IRAs)

Traditional IRAs are very accessible and easy to open for everyone with some income. IRAs are funded with your tax dollars so you can enjoy tax-free growth. There are no income restrictions, meaning anyone can contribute.

There are a couple of IRAs. Some are advised only as an additional retirement plan, such as ROTH IRA. Others, such as Traditional IRA enable all retirement plans to be rolled through it. However, there is one thing all IRAs have in common – they are a better plan option for people who are closer to retirement. They give both tax deductions and tax deferral and when the time for making withdrawals come, you will be taxed on your contributions, but not on a capital gain. 

Real estate

Saying that investing in real estate is one of the best ways to plan for retirement seems to be confusing. But real estate has always been one of the steadiest sources of constant income. The value of a real estate is very unlikely to go down over time, and you stand the best chance of long term success if you hire a Registered Investment Adviser. They will help you balance the risk with a property in order to get the maximum revenue possible. 


There are a lot of makings of a good retirement plan and what will be the best plan for you depends on your needs and possibilities. But whichever retirement plan you choose, one thing remains the same – don’t wait for later midlife to start setting up your funds. The best time to start is in early adulthood, as that will give you more than enough time to secure your future.

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