First Person: Realistic Alternatives to Maxing Out My Retirement Account

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I am making choices now that should result in a more comfortable retirement when I'm older. One thing I'm not doing, though, is maxing out my retirement. I am concerned about the future, but I also have to live in the now. At age 40, I have too many pressing financial obligations that take precedence over my retirement. Still, I've been able to find realistic ways I can move closer to my goal of being financially independent in my old age. According to a recent article by U.S. News & World Report, not everyone needs 100 percent of their pre-retirement income in order to be happy. The article offered more "realistic" ideas for a retirement strategy.

Downsizing our mortgage

Although experts often suggest people downsize their housing in retirement, we opted to downsize our mortgage. We reduced our payment from $1,200 to $900 a month by refinancing. Even if we pay the minimum on our house we will be free of a mortgage by the time we are in our mid-50s. I don't anticipate moving before or after we retire since we can easily manage our home. If we have grandchildren one day, we will be glad to have four bedrooms for them to visit. By paying off our mortgage, we will eliminate a major monthly expense in retirement.

Avoiding long-term debt

It's difficult to max out our retirement savings at this time since we are helping to pay for our children's college tuition. Still, we aren't co-signing college loans because we don't want to be paying for student loans in retirement. In the long run, we will be glad we helped our children get settled in their careers. With a college education, our children are more likely to be completely financially independent by the time we retire. My husband and I are making an investment not only in their future, but in our own futures. We are also avoiding car loans and credit card debt with our retirement in mind.

Seeking out free entertainment

Experts recommend senior citizens take advantage of discounts and search out free entertainment. I am already in the habit of looking for deals. Our entertainment budget will be small when we are retired because we know how to amuse ourselves. I don't need to max out my retirement account in order to afford cruises, spa visits or trips to the opera. I'm fine with using my public library.

I also found it doesn't cost anything to learn how new skills and techniques that will make me more self-sufficient in retirement. I spend my free time gardening, cooking, canning and learning how to fix things. Although we have a small yard, we are maximizing our space with fruit trees, an herb and vegetable garden. Our compost pile is worth more to me than a pile of cash in a retirement savings account because it represents our ability to put to use what we already have. We can realistically live on a smaller nest egg in retirement because of the simple, non-materialistic lifestyle we enjoy. It also won't hurt to be free of debt in retirement.

More from this contributor:

I'm Not Retiring to a College Town

Best Money Moves After College

Planning for an Extreme Early Retirement

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