How to Prepare for a Successful Retirement
As you approach retirement, it’s vital that you pay attention to key financial matters. Here are some of the items that you should check:
Health Insurance.
Are you among the lucky few who will continue to be covered after retirement? If not, then you’ll need to replace your health coverage.
If you will be eligible for Medicare at the time of your retirement, then you may want to start checking into “Medigap” coverage. Medigap insurance is a supplemental health insurance sold to individuals age 65 and older that covers medical expenses not covered or only partially covered by Medicare.
Tip: Before you retire, take care of any non-emergency medical, dental, or optical needs (if your employee plan coverage is broader than Medicare).
Other Types of Insurance.
Once you retire, you may need to replace employer-provided life insurance with extra coverage. You should also consider purchasing long-term health care insurance in case of a lengthy nursing home stay in the future.
Social Security.
Decide whether you want to take early Social Security benefits if you’re retiring before your full retirement age, which is currently 66 years of age for people born between 1943 and 1954. You can get 75% of your benefits at age 62.
Tip: For most people, taking Social Security benefits at their full retirement age makes the most financial sense. If you think you might need to take early benefits, give us a call. We’d be happy to discuss this with you.
Company Plan Payout.
You should plan well in advance how you’ll take the payout from your pension plan or 401(k) plan. For example, will you transfer the funds to an conventional or Roth IRA? How will the funds be invested?
Relocation.
If you’re planning a move to another state, make sure that you fully explore the financial ramifications of living there–before you move. Cost of living rates can vary significantly from one region of the country to another.
We Can Help. Retirement is an exciting time and planning in advance can make it a much smoother transition. Please contact us if you have any questions, need assistance or just want some additional guidance.
By Leon Clinton