Retirement Planning Tips for the Homestretch of Your Career
Filed under: Retirement
Retirement is right in your sights, and you’re getting ready for your golden years. The final years before retirement can be exciting and full of anticipation. They can also be a crucial time to make sure you’ve hit your savings goals. If you’re in the homestretch, then saving should be a top priority. There are lots of ways you can maximize your efforts. For example, if you’re over the age of 50 you can take advantage of catch-up contributions to your 401(k) or IRA.
But saving money is only one aspect of a good retirement plan. There are some other things you may want to consider after you’ve decided to stop working. Below are a couple of tips that could help you minimize financial risks and enjoy more stability during your retirement:
Contribute to your HSA.
A study by Fidelity found the average retired couple can expect to spend $260,000 in out-of-pocket medical expenses during their retirement.1 While Medicare might cover some of your health care expenses, it won’t cover all of them. One way to prepare for the cost of treatment during retirement is to contribute to a health savings account (HSA).
An HSA allows you to make tax-deductible contributions. It also offers tax-deferred growth, and the funds can be withdrawn tax-free as long as they’re used for health care expenses. What’s more, you are able to take an HSA with you after you retire. So if your current employer health plan offers an HSA option, it might be worth looking into.
Have a plan for long-term care.
According to the U.S. Department of Health and Human Services, 70 percent of 65-year-olds will need some type of long-term care.2 This type of care is extended assistance, which usually means you need help with day-to-day tasks such as dressing, bathing or mobility. Long-term care can be administered in the home or at a facility, but either way, the service is typically costly.
Long-term care insurance can help you offset these costs. Normally it involves paying a premium today in exchange for coverage in the future. There are many types of long-term care available. Some cover both at-home and facility care. Some even offer death benefits that might help you maximize the assets you leave behind to your loved ones if you end up not needing to use the long-term care coverage.
Have a contingency plan.
Life can be full of surprises, and not always the good kind. For example, you might reach retirement age with less saved than you had planned. Or you might be forced into early retirement due to a disability or job loss. You might even encounter a medical emergency that forces you to drain your retirement funds.
Whatever the case, it doesn’t hurt to have a backup plan. You might consider working part time. Downsizing is also an effective strategy that can help lower your income needs. Thinking of ways you can overcome unexpected life events can give you peace of mind and help reduce the amount of risk you’ll face during retirement.
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.
2 http://longtermcare.gov/the-basics/who-needs-care/
This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice.
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