Sharpen Your Financial Skills After Age 60
Filed under: Retirement
As we grow older, most of us accept the fact that our bodies don’t perform as well as they once did. But for some reason, it can be more difficult to accept the fact that your mental acuity begins to decline as well.
In particular, many of us begin to make financial blunders after age 60. Not only are we more likely to make mistakes with our money; we’re also more likely to fall victim to a financial predator.
Exercise. Study after study has found a link between exercise and improved cognitive processing. Exercise is free, and you’ll certainly have more time for it once you retire! Try to go for a walk, bike ride, or swim every day.
Ask for help. Unless you are a licensed plumber, you probably wouldn’t install a new bathroom in your home by yourself. The same goes for financial planning! There’s nothing wrong with seeking the guidance of a financial advisor. In fact, it’s one of the best ways to create a secure flow of income in retirement, and to protect yourself from mistakes.
Consider a living trust. It’s an uncomfortable fact, but some of us will inevitably develop dementia or Alzheimer’s. A living trust transfers control of your assets to a trusted friend or family member in the event that you are incapacitated. If you set up the trust now, you can choose your own trustee.
Create a safety net. If you become concerned about your financial skills, a single-premium immediate annuity might be right for you. You make a single payment, and an insurance company sends you a fixed amount of money for the rest of your life. This protects you from the ability to make major mistakes, and ensures a steady income stream.
Simplify your investments. In your younger years, you may have taken more risks with your investments. It was one way to build up significant capital, while allowing you time to recoup your losses in the event of a misstep. But now that you’re older, it might be wise to switch to safer investment options. Talk to your financial advisor about safer, low-risk investment options like index funds.