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Planning for Retirement: Five Essential Questions to Ask

| July 31, 2019

Retirement is the time where we should be able to kick back, relax, and enjoy being free of responsibility. While we’re relieved from the heavy demands of being in the workforce, in retirement, we’re in charge of our own lives and futures. There’s no one telling us what to do or how to carry out our daily lives.

The ability to enjoy a happy and comfortable retirement depends on how well you prepared ahead of time. As you’re preparing for those days ahead, here are some questions you should ask yourself:

  1. What’s my ultimate goal in retirement? Many people dream of traveling the world, while others are content spending their days simply in the comfort of their own home. This is an important question that plays a role in how you map out your retirement. No matter how big or small your goals are, there are many factors to consider such as costs versus income.
  2. Do I have a good estimate of my retirement income? Calculate how much savings you have in your 401(k), pension, Social Security benefits, and any other investments. By getting a good snapshot of your assets, you’ll be able to determine how much of your dream is achievable.
  3. Have I estimated how much money I’ll need to cover daily expenses? Consider your “income floor,” the minimum income you’ll need to cover essential expenses such as food, housing, and healthcare. By itemizing and totaling up the monthly costs of each expense, you’ll have a better idea of how much you’ll need when weighing it against your estimated retirement income. If there’s an “income gap,” then you may want to consider investing a portion of your assets into an annuity for an additional income stream that’ll last as long as you do.
  4. Do I have a plan for healthcare costs? Rising costs of healthcare is a reality, and no one wants a long, unhealthy life. Taking an account of the healthcare expenses you may face is vital to any retirement plan. Have strategies in place to make sure you have enough coverage for your medical needs. Please note that Medicare will cover only 50-60% of your healthcare needs and doesn’t cover a majority of long-term care costs.1 So, to ensure you have proper coverage for these costs, you’ll want to look into long-term care insurance.
  5. Have I made an estate plan? To ensure that your assets are properly transferred to your loved ones, it’s critical that you start estate planning sooner than later if you haven’t already. By having one in place, you can minimize estate taxes and more importantly, give yourself and your family a peace of mind that everything is taken care of.

Retirement should be exciting and a fulfilling period of your life, provided you prepared for it. It can be overwhelming to consider all of the different factors but you’re not alone. Contact us today–our passion lies in helping out our clients achieve the retirement lifestyle that they dream of.

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