When preparing for your golden years, getting your finances in order is an important first step. The earlier you start planning, the better. Here’s a quick to-do list for couples to make sure you’re on the same page when planning for retirement.
First, it’s important for couples to ensure that both parties are on the same page when it comes to planning for retirement finances. Sit down together and look at your accounts. Do you have the passwords needed to access key information? Are you both informed about your individual and shared accounts, assets and debts?
Additional questions to ask include: Are you planning to retire at the same time? Will you retire early or later? What kind of lifestyle do you hope to have? Getting in sync can make the planning process much smoother.
To financially prepare for retirement, you’ll need to figure out how much income you’ll need to maintain your current lifestyle. Factor in costs such as rent/mortgage, groceries, healthcare and unexpected expenses. Looking at what you spend now can get you a basic picture of what you’ll need during retirement.
Many seniors fund retirement through savings, retirement accounts or by selling a large asset (such as a house). Look at the assets and savings you have available and determine how you want to use them during your retirement years.
Even if you haven’t accumulated a large amount of savings over the years, it’s never too late to start. Make a point of contributing to your savings as much as possible, even if retirement is right around the corner. Every little bit helps.
If you are able, it’s a good idea to pay off any lingering debts before you retire – especially high-interest ones such as credit cards. You might also consider paying off large debts (such as your mortgage) and determining how you plan to use your assets (i.e., leave a home or car to a family member in your estate planning).
If you have retirement accounts such as a 401(k) or IRA, maximize the contributions you are making to them. If you are over 50, you can take advantage of catch-up contributions, which allow you to make more than the regular maximum payment.
Review your social security benefits and options for receiving them. This will factor into your retirement budget. Will you or your spouse be retiring with a pension? Read the fine print and ask questions to gain clarity on what you will be receiving, and when.
Don’t forget to plan insurance and healthcare during your retirement years. Check your Medicare benefits and when you will be eligible to enroll, if you haven’t already.
In addition to planning for retirement costs, now is a good time to meet with a lawyer and create (or update) your estate plan and will. While estate planning can feel like a chore, knowing everything is in order can give you and your spouse peace of mind during your retirement years.
If you live in a large home or are interested in living more simply, you may also want to consider downsizing before retirement.
A financial planner is a great resource for couples planning for retirement and can help with just about any item on this checklist. They can advise on topics from maximizing contributions to creating a realistic budget.
They can also explain important tax information, such as tax implications related to withdrawing your retirement benefits.
Now that you’ve tackled the intimidating task of planning for retirement, you can sit back and dream of what’s next for you and your spouse.
Remember – these are your golden years. Whether you want to spend quiet evenings reading together on the porch or explore new places through travel, your retirement is whatever you want to make it.
Advent Christian Village offers options for members with different resources, health concerns and retirement goals, and we might just be the perfect fit for you. Schedule a tour at our Live Oak retirement community today – we’d love to speak with you.
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