3 Retirement Planning Issues for the Final Years of Your Career
Filed under: Retirement, Life Events
If you’re in the last couple of years of your career, you may be starting to think about retirement. If so, you’re not alone. A Gallup study conducted in 2016 showed that the majority of people nearing retirement have concerns about covering all their costs after they quit working. These concerns range from not being able to pay medical expenses to not having enough money to simply cover their normal monthly bills.1
Planning for your ideal retirement involves more than just saving money. If you are approaching the end of your career, there are a number of important decisions you may face. Below are three things you may want to consider as you plan for your retirement:
High-Interest Debt
High-interest debt can be a drag on your financial stability, especially in retirement. While Social Security can cover a portion of your retirement costs, you will more than likely need to supplement it with your own savings. And if you use those savings to pay off high-interest debt, you may find yourself with less income available to support your lifestyle.
It may also be important to learn the difference between certain types of debt. While you may want to spend your non-working years debt-free, things like mortgages, which typically come with lower interest rates, might not be as damaging to your financial stability as something with higher interest rates, like credit cards.
Knowing Your Options When It Comes to Medicare
You have probably been contributing to the Medicare system for decades. Retirement is the time when you get to stop contributing and start benefiting from the program. There are several types of Medicare plans available. It’s important that you understand your options and your needs so you can choose the plans that are right for you.
For instance, Medicare recipients are covered for hospitalizations and doctor visits and can also receive optional coverage for prescription drugs. There are even programs like Medicare Advantage that bundle your coverage with other benefits such as dental and vision. All these plans come with different costs and benefits, so be sure to examine your needs carefully.
There are, however, some things the program does not cover. An example would be international treatment. If you’re planning on spending your retirement outside the U.S., you may want to take some time to review alternative options.
Long-Term Care
According to recent studies, 70 percent of individuals turning 65 can expect to use some form of long-term care in their lifetime.2 It’s not fun to think about, but the possibility that you or a loved one will need long-term care is very real. Additionally, long-term care generally is not covered by Medicare.
One possible funding strategy is long-term care insurance. In these policies, you pay a premium today and receive future benefits to help you pay long-term care costs. Long-term care insurance policies require underwriting, so you may want to consider them while you’re still healthy.
Ready to make the final planning decisions before you retire? Let’s talk about it. Contact us at Ambrose Financial & Insurance Services for more information. We welcome the chance to help you analyze any remaining questions and develop a strategy. Let’s start the conversation today.
1http://www.gallup.com/poll/191174/americans-financial-worries-edge-2016.aspx
2http://longtermcare.gov/the-basics/who-needs-care/
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16160 – 2016/10/18
