Celebrate financial independence

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It’s the Fourth of July. How close are you to achieving financial freedom?

If you look around at the people you know who appear to be happy in retirement, chances are many of them aren’t wealthy but they are free from financial hardship, and they have reached a point in their lives where money doesn’t drive their decision making.

Take these seven steps to put yourself on the retirement planning path to financial independence.

  • Pay off your debt. Some 41 percent of workers 55 and older told the Sloan Center on Aging and Work at Boston College that they had as much in credit card debt as they did in retirement savings; 30 percent said they had more credit card debt than savings. That kind of ratio makes freedom hard to achieve.
  • Commit to saving. The more money you put aside, the less you have to worry about running low.
  • Manage your Social Security. The age at which you decide to take Social Security is a very individual decision. But keep in mind that if you decide to take it at 62, the earliest point for most — when 41 percent of men and 46 percent of women claim — you’ll lock in the lowest payment for life. If Social Security is going to be a major part of your retirement income, think hard before you lock yourself into a financial straitjacket.
  • Learn to love your budget. Making and following a budget may seem restrictive at first, but it helps free you from ugly surprises and financial train wrecks that leave you without enough money to cover the basics.
  • Invest time in your passions. Continuing to get better at doing what you like to do best is always a good investment, and it could prove to be your ace in the hole.
  • Listen to good advice. Retirement planning isn’t easy. If you don’t understand something or you don’t feel in control of your finances, get some expert advice — and listen to it.
  • Get ready for a marathon, not a sprint. We’re living longer. Do what you can to keep yourself in the best shape possible — physically and financially — to enjoy life to the very end.

Here’s hoping your Independence Day is great.

Now that we’ve achieved financial freedom, here are some retirement issues worth worrying about.