I know people who have failed to thoroughly plan their retirement because it seemed too complicated and time-consuming. Lots of people feel that way. People get stuck in the details. So let’s start making retirement planning easier for you.
With this post and three more that will come soon you’ll gain basic ideas on simple steps you can take. Just tackle one idea at a time. Don’t worry about getting everything done today. Get started. So let’s do that:
3. Estimate Your Retirement Spending Needs
If you don’t determine your retirement expenses, you'll never know if your retirement savings will be enough. Take the time to think about future expenses so that you will have a clear understanding of whether your assets will adequately provide for your retirement lifestyle. Remember, too, that today retirements can be long—15, 20, 30 years or more.
4. Make Sure You’ll Have Adequate Medical Coverage
Hospital and other medical charges can devastate anyone’s finances. In fact, healthcare is one of the biggest retirement expenses. Be sure you’ll have continuous health insurance coverage immediately after you quit work. Don't spend a day without being covered. The risk of receiving life-changing bills is simply too great to ever go without health insurance.
That reminds me of a true story. A friend I know had a very poor health insurance plan. At age 62 he had to have open heart surgery. Because of his financial situation, the gracious hospital gave him 45 percent off their normal charges. But guess what? Even with his health insurance and his 45 percent cost reduction he ended up with a bill for $43,000.
5. Understand Social Security
You should definitely have an idea of when you'd like to start drawing Social Security. You’ve got options here—know them and choose what’s best for you and your spouse. Before you sign up, make sure your earnings history has been recorded correctly. An incorrect earnings history could cause you to miss out on some of the money you’re entitled to. Some of my clients have found the customer service at the Social Security Administration to be good. Their number is 1-800-772-1213 (1-800-325-0778 if hearing is hard for you.)
So that’s it. Just work on those two items. Return to this space in a week or so and I’ll have two or three more ideas for you.
Questions? Comments?
