The 5 most stressful financial concerns for pre-retirees
If you’re thinking about retiring, you may be facing fears of being able to survive on a limited, fixed income, in a world where everything is becoming more expensive.
1. According to top financial planners, the biggest pre-retirement concern is whether or not their retirement fund will last.
Setting aside hard earned money during your working years may be difficult, but advisors will tell you, they never hear complaints from retired clients that they’ve put too much money away!
Having enough savings to retire on is first in line of pre-retirement financial concerns. Other concerns ranking high are; rising healthcare costs, Social Security, and unforeseen expenses and debt.
2. Rising health insurance costs is the second most common concern.
If you have post-retiree health insurance coverage consider yourself lucky. These benefits are rare and not available or affordable for most employers.
The majority of retirees rely on Medicare. Educating yourself on Medicare Parts A, B, C & D, may help ease your uncertainty. The official U. S. government site for Medicare is www.mymedicare.gov. There you will find information on Medicare plan basics and costs. You can chat online with representatives or call to speak with someone directly.
Medicare Supplement policies will help fill in the gaps of Medicare. To review the official Medicare site for plan options Click Here>>
AARP members can take advantage of discounts through UnitedHealthcare for Medicare Supplement policies. For information on those plans Click Here>>
Or contact a financial planner in your area to assist you with information on these coverages.
3. Social Security Retirement Benefits is what most of us depend on either as a supplement to our savings or depend on it completely at retirement.
Most people believe that Social Security benefits can’t be claimed until their government established “normal social security age” (which varies based on when you were born). Depending on your individual situation, you can claim benefits prior to this age, or you can defer payments to an older age. The longer you defer receiving payments, the higher the payments will be.
To see what your Social Security estimated payments will be, sign up to view your social security statements online at: Login to SSA here>>
If you’re not entitled to retirement benefits on your own, you may still be entitled to benefits on the record of a current or divorced spouse. For more information visit www.ssa.gov.
4. Unforeseen expenses, mortgages and debt are other concerns when on a limited budget.
From unexpected illness, to major home or automotive repairs, unforeseen costs can impact your retirement fund. Setting aside an emergency fund, or strategizing with a financial advisor can help you prepare for these types of occurrences.
Other debt such as mortgages, credit cards, or financially assisting family members can add to financial stress. Retirees often qualify for reduced monthly payments on their mortgage, or a reverse mortgage may be an option.
Consolidation loans or consulting with a financial advisor may help with debt. And while lending money to family or friends may be a generous thing to do, many times these types of “loans” turn out to be losses.
5. End-of-life planning is something many of us don’t like to think about.
Even though we’ve planned to financially take care of our loved ones through life insurance, retirement benefits, a Will or Trust, we still don’t like talking about the subject.
If you’ve set up any of these accounts or plans, make sure someone knows they exist! A recent survey shows that 59% of families encounter funeral expenses after a loved one dies. Today, over a billion dollars of life insurance has gone unclaimed because beneficiaries didn’t know it existed! So communicate your plans and assets!
Make sure to have Advance Directives, Power of Attorney or Payable Upon Death paperwork completed. Assign a successor or executor to handle your estate. And communicate your final wishes to your loved ones to spare them from having to make difficult decisions without knowing your wishes.
The thought of retirement forces us to consider all these realities. But with some planning you can continue to live the lifestyle you enjoy now. Whether you continue to work part time through your retirement, donate your time and service to others, or simply relax and enjoy the good life, with a little planning you can enjoy the retirement you’ve always dreamed of.