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Editorial Advisory Board

  • Professor Andrea M. Armani, University of Southern California
  • Ruti Ben-Shlomi, Ph.D., LightSolver
  • James Butler, Ph.D., Hamamatsu
  • Natalie Fardian-Melamed, Ph.D., Columbia University
  • Justin Sigley, Ph.D., AmeriCOM
  • Professor Birgit Stiller, Max Planck Institute for the Science of Light, and Leibniz University of Hannover
  • Professor Stephen Sweeney, University of Glasgow
  • Mohan Wang, Ph.D., University of Oxford
  • Professor Xuchen Wang, Harbin Engineering University
  • Professor Stefan Witte, Delft University of Technology

Aleph Retirement Planners Shares Expert Strategies to Eliminate Debt Before Retirement

Almost 61% of Canadians said in a 2024 survey that they fear going broke during retirement. Some young adults also feel their savings will not be sufficient when they retire. These people don't have a proper retirement plan. However, these thoughts do not bother other Canadians with an appropriate financial plan. Which boat are you in? Planning is the only option to live a peaceful retired life. It gives you a practical sense of what works and what doesn't. For example, people take different types of loans at a young age. These debts pile up over time, threatening financial stability in the future. Hence, they worry about managing them and protecting their retirement savings.

Debt management is an essential step in retirement planning. Without proper knowledge and experience, these areas can feel overwhelming. You can seek guidance from experts like Aleph Retirement Planners. Most planners suggest people should pay off their debts before retiring. Is it feasible? Professional retirement planners can explain the why’s, what’s, when’s, and how’s of debt management so that you enjoy a stress-free future. Here are some critical insights regarding this particular area.

Debt elimination before retirement

When you approach professionals for financial guidance, they often discuss debts, a standard component of most household expenses. Managing them is crucial to protect your present and future. Typically, fixed interest rate mortgages with low premium amounts are advised to be repaid slowly. However, a high-interest credit card balance should be addressed first. How you pay it off depends on various factors. Nevertheless, getting rid of it as early as possible can help you save for an emergency fund, retirement, big-ticket items, or a dream travel destination.

The other type of debt that can also be prioritized includes large balance unsecured debt, such as student loans. Then, you may have taken out secured loans like car loans and mortgage loans. These contain collateral. If you miss your payment, your asset will be gone. So, making a budget around them is also critical as a retirement planning step. How do you take charge of your debt now to live peacefully in retirement? Experts recommend two payment methods - snowball and avalanche.

Reliable debt payment methods

The approach to paying off debts will depend on your retirement plan. Still, some basics don't change. A list of unsecured and secured debts is prepared and ranked according to high to low interest rates and balances. After this, the planner can review your expenses and recommend ways to reduce them so that you can clear your debts. As hinted earlier, snowball and avalanche are the two popular options. The snowball method refers to clearing small debts first while contributing a minimum sum to other debts. After you pay off the smallest loans, you move on to the other smaller options.

On the other hand, the avalanche method takes the opposite approach, requiring you to clear the highest-interest loan first while transferring minimum payments on other debts. It is also like a snowball method but prioritizes the highest-interest loans.

Remember, it's not about becoming entirely debt-free; it's about having a proper strategy to minimize financial chaos and live a fulfilling retirement.

Media Contact
Company Name: Aleph Retirement Planners
Contact Person: Jessica Brown
Email: Send Email
City: Toronto
Country: Canada
Website: https://alephretirementplanners.ca

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