Written By The Simply Homes Team | November 2, 2022 | 4 minute read
Life is expensive. A nest egg (or life-savings fund) is a financial strategy to help cover some of life’s greatest costs.
Built by saving and investing, it is usually used for expensive life milestones such as attending college, buying a home, or starting a business. The money can also be used as an emergency fund to pay for medical, home, or car emergencies.
A life-savings fund is what allows you to retire. It’s what will allow you to spend your last few years relaxing and spending time with family.
Many people grow their savings through their employer-sponsored retirement program — typically a 401(k). Some people prefer to invest their money in IRAs and investment accounts that give them more control and return on their investments.
These funds are built up over time. You usually start them in your early 20s and build them up throughout your working life. Typically you will want to have twice your annual income saved up at age 40, four times by age 50, and six times at age 60.
Unfortunately, a life-savings fund is a lot harder to build later in life. If you haven’t been building up money for several decades, you won’t have as much time to build up money, and you will have less time to earn capital from your investments.
However, there are still options you can take to earn and save extra money to put away for life’s big expenses. Here are five ways to quickly build up your nest egg investments.
It’s never too late to start investing. According to NerdWallet, people in or nearing retirement can still take advantage of investing, but with a more short-term strategy than younger investors. If you are around 55 to 64, you will want to start investing the most you can in your 401(k), thrift savings plan, IRA, or other retirement plans.
If you already have a well-stocked emergency fund and enough money saved to cover expenses, try investing your money in aggressive stocks that can give you a return quickly. While you will have a higher chance of earning money, you will also have a higher risk of losing it — so make sure you only invest money that you can afford to lose.
Look at your monthly budget and determine which of your expenses are needs and which are wants. Look through your wants, and see if you can sacrifice or cut down on anything. If you love expensive nights out, try cooking cheaper meals from home. Stop paying for the extra streaming service you rarely use. Keep your car in the garage and walk or take public transportation more. There are usually several small cuts people can make to save extra money.
A side job is a great way to build your nest egg investments. Nowadays, anyone can earn extra money by working for food delivery or car share apps such as Door Dash and Uber. You can also put your skills and hobbies to good use! If you love to bake, start an online bakery. Sell your art at a local art show. Teach your favorite subject at a community center. Earning extra money doesn’t have to be boring!
If you’re an empty nester or have extra rooms in your house, rent them out. The extra space in your home that’s burning property tax could be the key to early retirement.
According to Dave Ramsey, an extra $500 a month could potentially increase your savings by 35%. The little extra work can go a long way in building a sizable savings fund.
If you’re an empty nester, it may be time to sell. Houses cost a lot of money to maintain, and property taxes can drain your savings quickly.
“One of the homeowners' greatest fears is that some undetected malfunction might snowball and turn into a catastrophic problem. While your house may look beautiful and everything may seem fine, costly issues could be lurking beneath the surface.” – Souki Fournier
Consider selling your home and putting that money into your savings. You’ll save on house expenses and have more money to spend at the beach. The same applies to those near or far from retirement who need to grow a retirement fund as fast as possible.
Selling a house can be an expensive and time-consuming venture on its own. Many real estate agents will suggest costly repairs or remodels, then schedule lengthy and complicated open houses. That’s time and money that you could put into your funds!
Tip: Look for a buyer who will make an as-is and cash offer.
An as-is offer means the buyer will take the house in its current state and will pay you the full price of the house in cash. Then you put your extra time and money into your savings.
Use Simply Homes to find the best offer possible on your house in as little as 30 seconds. Simply’s offer will be as-is and cash. Best of all, the offer is commitment-free, so contact Simply now to see how much your savings could benefit from selling your home.
This is typically a last resort, but it isn’t terrible. If you are in good health and enjoy your job, then there is no reason to quit while you can still go! An extra five or 10 years could be just what you need to grow your nest egg investments into a fulfilling retirement.
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