We all want to be financially secure during retirement. But doing something about it can seem impossible. When we’re struggling to keep up with skyrocketing healthcare costs, runaway college tuitions, mortgage payments, taxes and an endless stream of bills, building a sizeable retirement nest egg seems more of a “would be nice” goal rather than a “must do now” priority.
Unfortunately, the clock is ticking. And unless you’re sure that a future windfall or inheritance will bail you out of a retirement savings shortfall, it’s up to you to ensure the security of your golden years. That’s why it’s important to connect the financial aspects of retirement with your vision of what you want your golden years to be like. If this is too daunting to do yourself, a qualified fee-only fiduciary adviser can help.
Meanwhile, here are five important issues to start thinking about when you’re planning for retirement.
1. Create your retirement “wish list”
It’s never too early to start thinking about how you’ll want to live during retirement, all of which will determine how much money you’ll need to support your lifestyle. You’ll want to consider:
2. Figure out where the money’s coming from
How much you’ll have to spend each year will depend on how much money you have coming in. Depending on your work history, you’ll generally have several sources of retirement income.
3. Don’t forget about healthcare
The longer you live, the more likely that healthcare costs will consume a significant portion of your retirement nest egg. That’s why it’s important to plan for them.
By age 65, you’ll want to enroll in Medicare as your primary healthcare insurance provider. If you miss the enrollment deadline, you’ll end up paying significant late-enrollment penalties, some of which may last until the end of your life.
And don’t forget about long-term care, especially if there’s a history of dementia or chronic illness in your family. Nursing homes or assisted living facilities can cost more than $100,000 per year.
4. Save more, invest smarter
If your calculations show that your retirement nest egg won’t be large enough to fund the retirement you want, take matters into your own hands while you still have time.
5. Hire a trusted expert to figure all this out
If all of these suggestions seem overwhelming, don’t take on the burden alone. An experienced financial planning professional can work with you to address all of these issues, from estimating future retirement income and expenses to recommending changes to your retirement savings strategy and managing your investments.
For a savings goal as critical as retirement, you’ll want to work with a fee-only fiduciary financial advisor. While many financial professionals claim to be fiduciaries, only fee-only advisors can be trusted to act solely in your best interests, the foundation of the fiduciary standard. That’s because they’re paid directly by you. Unlike other advisors, they don’t earn commissions or sales bonuses for trading stocks or selling mutual funds or insurance, so they can serve you with undivided loyalty.
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Underwriters: Envestnet and United Capital