Vacationing through Europe and long, lazy days on the beach are the dream of many when it comes to retirement. However, the reality is a bit different, especially if you’re unprepared. Unfortunately, a financially healthy and stable retirement doesn’t happen by accident – it takes years of careful planning. The sooner you get started, the better shape you’ll be in when the time comes.

If you want to afford travel, maintain your lifestyle, and help your children and grandchildren financially, you need to get started now. These tips will help you prepare for retirement so that, when the time comes, you can enjoy it.

A financially healthy and stable retirement doesn’t happen by accident – it takes years of careful planning. Here are some tips to help you prepare for retirement so you can enjoy it.

1. Face the Numbers

The absolute first thing you need to do is get honest with yourself. Sit down with all your financial information – net worth, debts, savings, investments, and income. You can’t adequately plan for the future if you don’t have a thorough grasp of your starting point.

You’ll also need to calculate your current cost of living to determine how much you’ll need to save for retirement spending.

According to experts, you can expect to need about 80% of your current income once you retire. However, after factoring in inflation, you may need even more. Once you hit retirement, the typical recommendation is to pull only 4% of your money out of retirement accounts each year. Following this rule will help your savings last you up to 30 years.

2. Pay Off Debt

Bringing debt with you into retirement can be crippling. The good news is, with enough planning, you can rid yourself of it with plenty of time to spare. You’ll also save extra money on interest by paying debts off early.

The “debt snowball” is one popular technique for tackling your debts. Tackle your smallest debt first by throwing any extra cash you have at it. The suggestion is to cut back on other areas of spending to move as much money to that debt as possible. In the meantime, continue making minimum payments on your other debts.

Once you pay the first one off, re-allocate the money you were spending on it to the next debt in line. As you continue to pay things off, your monthly payment on your current focus increases, helping you to get out of debt faster and with less interest.

3. Start Saving Now

Once you start to get your debt under control, you’ll have more money to build up your savings. Even if you only set aside money in a savings account – which probably isn’t the best strategy – you’ll generate more interest the longer it’s in there. Today is the time to start planning for retirement.

Start small with just $50 per paycheck at first and increase from there as you’re able. Keeping your end financial goals in mind, you may need to adjust your current or future lifestyle a bit to save enough.

4. Plan for Big Expenses

When planning how much you need to save for retirement, add in extra for planned and unplanned large expenses. Health care coverage is a big one after retirement that many people fail to remember.

Once you’re no longer employed, your health care coverage will likely reduce or become your responsibility completely. Also, as you age, your insurance will become more costly as your likelihood of developing a condition or having an accident increases.

If you plan to remain in your current home once you eventually retire, you should consider any changes you might need to make. Depending on the layout, you may need to pay a contractor to make accessibility improvements, such as an elevator, stair lift, or wider doorways.

You’ll also want to consider any fun purchases you’re hoping to make in the future. If you dream of traveling, you need to account for that now or you’ll quickly eat through your funds. Likewise, a fancy new car or boat will also drastically reduce your savings.

5. Contribute to an IRA and 401(k)

Setting up an individual retirement account (IRA) and a 401(k) might be your best bet for meeting your financial goals. Both will help you save for the future but differ slightly, so it’s important to know about each one.

IRAs are a form of retirement savings account anyone can open, even if they’re unemployed. They come with a slew of tax benefits, which makes them an ideal investment. However, they have a yearly contribution limit currently set at $6,000 – but it’s subject to change.

A 401(k) is an account set up through your employer. The yearly limits are much higher on these, so you can add more after maxing out your IRA. You should check to see if your employer offers contribution matching. Some companies will add the same amount you do up to a certain amount or percentage of earnings.

If you work somewhere with contribution matching, invest in your 401(k) first each year to maximize your savings. Once you’ve met that goal, switch to funding your IRA. After you’ve completed both of those, you can continue contributing to your 401(k).

You Can Successfully Prepare for Retirement

A lot goes into proper retirement planning, but the process doesn’t have to be scary. Hiring a financial advisor might be worth your money as you move along, especially if you feel overwhelmed by all the terminology and options. It’s essential to keep up to date with information and continue learning and growing as you move toward retirement. With new knowledge, you’ll be able to make the soundest investments for your future.

Keep your end goals in mind. Dream up the future you want to have and make it a reality. Taking steps now will help you prepare for retirement – one where you’re taken care of financially and have the opportunity to help your kids and grandkids as well.