You’ve made it through the nine-to-five grind and retirement is your reward. But stress about having enough saved for retirement is one of the reasons people are working longer these days.
The dot-com bust and the Great Recession did not help the prospects of Baby Boomers, but all is not lost. You can still salvage your portfolio and get the most out of your golden years.
It Starts with Planning
First of all, you need to have an idea of what income streams will be available to you during retirement. These might include Social Security, a pension, as well as your savings and investments.
Once you have identified these sources, you need to look at the expense side of the ledger. This includes how much you plan to spend each month, how long you will live, and the inflation rate.
Comparing your income with your expenses will give you an idea of where you stand today and what steps you need to make sure you will be in on solid ground tomorrow. Too many people don't start with their needs and plan ahead.
Getting Everything in Order
Now that you have a plan in place, you want to make sure everything is in order. Make sure you have updated the beneficiaries on all your insurance policies. In addition, you want to update your will.
Don’t forget to update the survivor information on your pension and your Social Security account as well. All this work might be a bit tedious today but it will save you and your family time and energy later.
It's important to make sure your beneficiaries match your will since your beneficiaries will take precedence over any information in your will.
Look at the Alternatives
Ok, you have a plan in place and everything is in order. Now is the time to look at potential alternatives. One alternative which is becoming more popular amongst seniors is the reverse mortgage. While it might not be for everyone, it is a good way to tap into the equity you have built up in your home. If you are considering a reverse mortgage, then you might want to check out this website as it offers a helpful Q&A blog. This will help you to see if this is a step which makes sense for you.
Today’s seniors have had to live through one of the most tumultuous economic periods in the history of the U.S. When times were good, they were very good. But when times were bad, they were very bad. It wasn’t just the recession either.
The economy has fundamentally changed over the last 25 years. Gone are the days of lifetime employment and guaranteed pensions. This means that today’s seniors need to fend for themselves. That said, they should consider themselves lucky as future generations will need to be even more agile if they hope to enjoy their retirements.
By the way, we are living longer as well. This means that it is more likely than not that you will face a shortfall in your retirement savings. However, this is not time to panic. Maybe you can continue to work part-time during your retirement as a contractor or a consultant.
This isn’t exactly full-time work, but it does allow you to set your own schedule while earning a little extra money. Next, you need see how this will impact other benefits. But if you have the opportunity to pad your post-retirement income, then you might as well take advantage of it.
Hold off on Social Security
Did you know that delaying Social Security until you are 70 can increase your benefits by 32 percent? This is a BIG number. Just think about it. If your scheduled benefit is $1,000 per month, delaying until you are 70 will increase the amount to $1,320. This might not seem like a lot of money now, but consider how that will help when you are in your 80s.
In addition, putting off on collecting Social Security will help your spouse collect more in survivor’s benefits after you are gone. If you were the primary breadwinner, then this can be a big help.
Of course, holding off until you are 70 might not be in the cards. There are plenty of reasons to take Social Security when you are eligible. What matters is that you look at your options, and perhaps get a little help with your retirement planning so you can make the most of your situation.