Showing posts with label Retirement. Show all posts
Showing posts with label Retirement. Show all posts

Friday, October 22, 2021

4 Crucial Home Repairs to Make Before Retiring

One of the most crucial parts of retirement planning is ensuring that any expensive repairs to your home are made before you stop working. By doing this, you can minimize your living expenses and make the money you've saved during your working years go further. Here are four crucial home repairs you should make before you retire.

Roof Replacement


If your roof is getting older, it's a good idea to completely replace it before you retire. A new roof put on at retirement will almost certainly last for the remainder of your time in the house. 

This step is especially important if some of the wood underneath the shingles needs to be replaced, as this can add quite a bit to the cost of a new roof.

Bathroom Updates


Updating your bathroom is a good way to add value and functionality to a home you've lived in for a long time. By updating your bathroom before you retire, you can fund the project with your regular income, rather than dipping into your savings for it. 

Having your bathroom updated shortly before you retire also gives you an opportunity to install handlebars and other safety features that you may need in the years to come.



Foundation Repair


A settling or bowing foundation can cause thousands of dollars in damage and undermine the structural integrity of your home. While foundation repair can be an intricate project, it's also very necessary if you're starting to see cracks or other signs of foundation damage. 

If you repair your foundation before retirement, you won't be stuck with even larger costs down the line.

Electrical Upgrades


If you're living in an older home, you may want to consider having it rewired before you retire. Older electrical systems aren't always capable of keeping up with the high power demands modern homeowners put on them. 

A new electrical system can also reduce the likelihood of electrical fires and damage, potentially saving you thousands of dollars down the road.

By making these repairs to your home before you retire, you can minimize the work you'll have to do after you stop receiving income from your job. 

While there will still be some upkeep costs for your home in retirement, getting the largest items taken care of now can give you a financial head start. Making repairs now will also benefit you when you eventually sell your home by increasing its market value.


Tuesday, October 5, 2021

Top 4 Places To Retire When You Have A Lot Of Life Left In You

Now that you have finally retired after decades of working, some people might think you are ready for a rocking chair on the front porch. However, you know better. 

Since you are only as old as you feel, you realize you've still got plenty of life left in that body of yours. With so many places to go and people to see, it's important to pick a retirement destination that lets you do that and much more. 

To make your retirement one that is fantastic day after day, here are four great places to enjoy your retirement.

Sarasota, Florida


If you want white-sand beaches, a walkable downtown, and plenty of things to do near your home, Sarasota may be the place for you. A major tourism spot in Florida, the city is filled with museums, art galleries, and restaurants that serve every kind of food you can imagine. 

When combined with low property taxes, almost nonexistent crime, and a large retiree community where you can make plenty of friends, Sarasota is hard to beat.

Myrtle Beach, SC


While many places may not be able to compete with Sarasota, Myrtle Beach is an exception. Home to about 30,000 permanent residents, this South Carolina paradise has golf courses galore, lots of festivals, and much more. 

Best of all, when you are exploring Myrtle Beach Premier Properties, you'll find out property taxes are low, the state offers a homestead exemption for residents over age 65, and plenty of other financial benefits.


Manchester, New Hampshire


Should you want to retire to the northeastern part of the U.S., Manchester is a New Hampshire city you may want to consider. Surrounded by mountains and forests, the fall foliage is spectacular. 

If you love wintertime and perhaps want to do some skiing or other winter activities, Manchester gets about 60 inches of snow annually. When it's not snowing, plan on visiting local farmers’ markets and retail shops on Main Street.

Nashville, TN


Finally, you can spend your retirement hanging out at the Grand Ole Opry and other spots in Nashville. Long known for being the country music capital of the world, Nashville also features over 100 public parks, museums and restaurants, and pro football and hockey teams you can cheer on when attending their home games.

Since you have no plans to sit in that rocking chair and count cars as they go by your home, consider any of these great retirement destinations. Whichever one you choose, your days and nights will be filled with plenty of fun activities.



Sunday, October 3, 2021

How to Make Sure You're on the Right Financial Path to Retirement

Planning for retirement doesn’t happen overnight. It takes careful planning and budgeting. The earlier you can get started the better position you’ll be on the right financial path to retirement. Here are some tips to help you get started!

Get Paid to Save With Your Employer


Many employers today offer a retirement savings plan like a 401k or a 403b where you may contribute a portion of your paycheck to go towards your retirement savings. 

This not only helps you start saving for the future, but employers may even match a percentage of your contribution. It’s literally free money for investing towards your future. Take advantage of this benefit if your employer offers it. It also uses pre-tax dollars.

Review Your Investments


In addition to a 401k plan with your employer, you can contribute to retirement through a traditional IRA and Roth IRA. There is a limit on how much may be contributed towards these plans each year depending on your income. 

Invest wisely by diversifying your portfolio. Don't put all your eggs in one basket. These investments also require periodic review. As you near retirement, consider investments with less risk. A financial advisor may help construct a financial plan to help you achieve your financial goals for retirement.




Budget for Your Retirement


How much you need to put away for retirement depends on the type of lifestyle you want to live. The factor is that on average Americans spend about 20 years in retirement, but the longer period of retirement you can plan for the more comfortable you'll be financial. 

If you want to maintain your existing lifestyle after retirement, you'll need about 70-90% of your pre-retirement income.

Reduce/Eliminate Debt


Entering retirement often means less income. The more debt-free you are, the less there is to worry about finding income to cover for that expense. Consider what you have and what you may want to offload. Do you have two cars, but only need one during retirement? 

Are you an empty nester and don't need a home with as many bedrooms? These are all considerations to help reduce and offload unnecessary expenses. The more you can clear out debt before retiring, the easier it’ll be for you financially.

Determine Your Retirement Age


Consider how long you will be working. Are you planning to take Social Security when you reach full retirement age? Taking it earlier can mean a reduction in your benefits, so the longer you can hold out until full retirement age the more benefits from Social Security.

It's never too early to start thinking and planning for your retirement! For some, a financial advisor may be necessary to help ensure the right financial path to retirement.


Wednesday, September 22, 2021

How Retirement Can Affect Your Taxes

As you plan for and ultimately begin your retirement, you'll be thinking about the many things you want to do and places you want to see. But to see many of these plans come to fruition, it takes money. 

Though you've been a careful planner for many years, you may not understand just how many ways retirement can affect your taxes. To help you make the right decisions regarding your retirement accounts and taxes, here are some important tips to remember.

Paying Income Taxes


If you assumed paying income taxes was a thing of the past once you retired, you may need to rethink this idea. Should you have income that is not tax-exempt, filing and paying taxes will still be part of your life each year. 

As of the tax year of 2020, if you filed jointly with your spouse who is also at least 65 years old and your income exceeded $27,400, this income could be taxed. Also, if you have income from a part-time job, you may meet the threshold necessary for you to pay taxes.

Maximize Benefits with Roth IRA


Since any contributions you make to a Roth IRA are done so with after-tax dollars, this means any withdrawals you make from this account during your retirement are tax-free. 

By working with a tax preparation expert on this, you can enjoy a steady retirement income without paying income taxes. Be sure to find a professional since handling your taxes incorrectly could result in serious legal consequences.



Take Advantage of Tax Credits


Once you retire, take full advantage of any and all tax credits that are available for you and your situation. For many retirees over age 65, the Credit for the Elderly or Disabled can be very helpful, especially if both you and your spouse are over age 65 and have a lower income.

Self-Employment and Retirement


If after retiring from your 9-5 job you decided to become self-employed, you can take advantage of some deductions regarding Medicare. 

In fact, you can deduct your Medicare Part B and Part D premiums, so long as you do not currently have access to healthcare through your spouse's employer. 

Also, even if you do not itemize on your taxes, you are allowed to deduct your costs for Medicare Advantage or any supplemental Medicare coverage, which could save you thousands of dollars per year.

Since you spent so many years planning for your retirement, it makes sense to do the same regarding your taxes after you're retired. From maximizing your Roth IRA contributions to knowing which tax credits you can take, you'll soon have even more money to spend on the fun things in life.



Saturday, August 28, 2021

5 Features Seniors Should Look for When Choosing a Home to Retire In

The home features that a senior needs will be a lot different than what they required when they got married or started a family years ago. 

When it comes time to retire, seniors must choose a home that specifically fits their needs and future needs so that they can live in it for years to come. These are five of the features that seniors should look for when choosing a home to retire in.

Wide Doors


Many seniors need a wheelchair or walker to get around. Because of this, it's imperative that they choose a home that has wide doors. This will allow them to easily be able to get in and out of their home without having to get out of their wheelchair or try to maneuver through with their walker just to get inside. 

Even if they don’t use a wheelchair or walker now, they may need one in the future.

Convenient Location


Location will be one of the most important parts of the decision when choosing a home. When looking at homes for sale, seniors need to think about how far away they are from their family, friends, and even their doctors. They don't want to have to spend a lot of their time driving to the location that they want to get to.




A Low-Maintenance Yard


A lot of seniors may struggle with their physical health, meaning that they aren't able to do yard maintenance like they may have been able to in the past. Because of this, they should choose a yard that won't require a lot of their time in order to maintain it.

A Ramp or No-Step Entrance


It's not that uncommon for seniors to lose some of their mobility as they age, and they may have a difficult time lifting their legs more than a few inches off of the ground. 

To make things easier, they should choose a home that has a ramp or a no-step entrance. This will allow them to easily get in and out of their home without having to worry about tripping.

Flooring With Non-Slip Surfaces


Falling in a home because of slippery surfaces is common among seniors. They can keep this from happening by choosing a home that has flooring that has a non-slip surface. Carpet or tile with a matte finish is both good options.

Many seniors live for quite a few years after they retire. Because of this, it's imperative that they choose the right home so that it will always meet their needs no matter how long they continue to live in it.



Monday, August 16, 2021

Into Retirement: 4 Ways to Make Managing Your Money Easier

Knowing how to manage money better is one key to achieving your financial goals. You don’t need to have a high-paying job or funding from relatives to improve your finances. 

Learning management skills is all it takes to reduce your spending and improve your ability to save and invest, hence achieving financial goals that seemed impossible. 

Here are four strategies you can adopt to manage your money effectively.

Create and Utilize a Budget

People who have a well-lined budget manage to tackle all their finances effectively. You need to spend a few hours at the start of every month and manage your money effectively by setting an accommodative budget

It is important to note that you also need to stick with your plan and utilize it to the end, and plan for your money. It is essential to regularly visit the budget within the month to know how much you have spent, how much you can pay out of your initial plan, and what you can save in the process.

Develop a Saving Habit


Avoid putting yourself in situations where you rely on credit for unexpected expenses. Prioritize on building your emergency saving account. Experts recommend a saving of three to six months’ worth of expenses. 

It is advisable to have a separate account for your long-term saving plan. Setting aside some of your income saves you from financial disasters and helps meet your financial goals.




Wealth Management

It is an investment advisory service that is involved in the management of affluent clients’ assets. Wealth managers create a close relationship with their clients to understand their financial needs and plans and help build a portfolio that will enable them to meet their goals. 

Some companies, like TFG Wealth Management, know that wealth management will help you achieve your goal by providing investment advice, accounting, and tax and retirement services. It is essential to check the credentials of professional wealth managers and see which descriptions best suits your needs.

Create a Plan to Pay Down Debts

Debt is a financial burden that affects your current budget and future savings. Take it thoughtfully and make it a precedence to pay off your debts. 

When you feel overwhelmed and have difficulty making payments, it is advisable to seek help from a professional non-profit credit counselor. They will give you financial advice that helps you develop a realistic budget and help you choose a good debt payment strategy.

The above four strategies may help you manage your money effortlessly. Always plan for your money at the beginning of every month by creating a realistic budget. 

Planning for your money will help you contribute to your savings account and getting out of debt. It is advisable to hire professional assistance to help you plan your finances.


Wednesday, August 4, 2021

5 of the Best States for Seniors to Retire to This Year

Hopefully, retirement brings a slower, easier, and more stress-free lifestyle. However, much of that depends on where you live. Here are five of the top states to retire. Some of the choices might surprise you, but they all have a low cost of living and a laid-back lifestyle.

Georgia


Hands down, experts rate the Peach State as the best place to retire in the United States. Not only can retirees enjoy a varied, four seasons landscape, but Georgia real estate is priced right. 

The Atlanta area median home price was just a little over $279,000 during the first part of 2021. That's $40,000 less than the national average. Georgia real estate prices are not the only thing that makes this state attractive; overall, the state has a low cost of living as well as low taxes. 

You can talk to a real estate company, like The Georgia Club Realty, about finding a home to retire to in Georgia.

Florida


It's no surprise that Florida is a great place to retire. The warm, tropical weather and endless beaches are a big plus. However, best of all, the Sunshine State does not have a state income tax, and it doesn't tax social security benefits or retirement income either. 



Furthermore, Florida doesn't have an inheritance or estate taxes. Finally, real estate and property taxes are reasonable. If you want to save some serious money during retirement, look to Florida.

Tennessee


With its mild climate and stunning landscapes, the Volunteer State has much to offer. Tennessee has the fifth-lowest cost of living in the country, around 10% below the national average. 

Add in the world-famous music venues, the numerous state parks, and its deep sense of history, Tennessee is the place to be.

Missouri


Surprisingly, the Show-Me State made the experts' top five states to retire in. Its low cost of living makes this state in the American heartland a good place to retire. 

Tax rates are reasonably low, and Missouri's natural beauty might surprise you. If you opt for small-town life, the big cities of St. Louis and Kansas City are not far away when you need them.

Massachusetts


Experts rate the Bay State at #5 mostly due to its wellness score. If you are dependent on healthcare, Massachusetts is home to some of the leading research hospitals in the world. While the cost of living is high, Massachusetts is known for its cosmopolitan and diverse culture.

While these five states are ranked highly by experts, you might find another state to call home in your golden years. When you are ready to retire, do your own research.



Monday, July 12, 2021

Will Social Security Provide You With Enough Money To Retire On

Can Social Security alone help you in your later years, or might you find yourself encountering major monetary problems? There are three factors that Social Security benefits themselves won't be adequate as your source of finances as a retired person.

1. Regular benefits are just not enough


The average Social Security check-in 2021 is $1,553.68 a month. If you collect something like this amount and your only income source is Social Security, you'll have an annual income of only $18,644.16. 

Chances are you will not have the ability to cover necessities such as housing, medical, food, and also transportation with that quantity. Even if your check is more than standard, it's not likely to be enough. 

Many people need to replace 80% to 90% of their pre-retirement income when they leave the labor force. Social Security is only supposed to replace 40% of your income, so you'll have a big revenue gap if you count on benefits alone.

2. You may need to retire before you need to apply for Social Security


For lots of people, it's optimal to claim Social Security benefits at age 70. Beginning checks at 70 gives you more money to survive monthly and allows you to optimize this inflation-protected, surefire revenue source. 



It's the best chance of optimizing lifetime benefits, enabling you to grow the amount of cash available to your making through your spouse if you were the greater income earner in your household. Yet most individuals need to retire before age 70-- or they wish to. 

If you're intending on Social Security being your only revenue resource, you would certainly have to claim your benefits soon after leaving your work. If you have savings to survive on, you can delay starting your retirement and enjoy the bonus that comes with waiting.

3. The buying power of benefits is falling


Social Security benefits are inadequate to support in your first year of retirement. And also, as you age, their buying power is most likely to fall. That's because benefits are safeguarded against the rising cost of living, given that the system uses figures and gives you periodic increases to your Social Security checks.

Cost of living adjustments (COLAs) are intended to guarantee benefits don't lose value and are calculated based on just how rates change.

Since this demographic team spends in different ways than elders, COLAS do not account for the bills retired people incur. The result has been a 30% reduction in the purchasing power of benefits over the past few years. This weakening in purchasing power will likely proceed.




There are additionally a couple of other problems that could reduce the value of benefits. First, the threshold at which Social Security benefits start to be taxed by the Internal Revenue Service isn't indexed to inflation. 

Hence, an expanding number of retirees end up losing a few of their benefits to the federal government annually. Unless legislators act, an automatic benefit cut of as high as 24% could enter into effect as soon as 2035. Changes to stop this benefit cut, such as boosting the full retirement age, might also cause a lowered benefit.

There are many reasons that Social Security can not be your sole revenue source, so do not depend on it for that. By beginning to spend for your future today, you can have higher economic security as a retiree.


Tuesday, July 6, 2021

How to Better Track Your Financial Assets as You Enter Retirement

After working hard for decades, you are finally entering your retirement. While you may be focused on moving to a new location or preparing to take one of many trips to different parts of the world, you should also be paying attention to tracking your financial assets. 

By doing so, you can avoid unexpected surprises that may derail your plans. If you are trying to figure out the best ways to track your financial assets, here are some suggestions.

Tracking Apps


Since there is an app for virtually anything anymore, it should be no surprise that numerous financial tracking apps exist. By taking advantage of these, you can simply pull out your smartphone and instantly view your financial picture. 

One of the best is Mint.com, where you can enter various types of financial data and have it all displayed on a single screen. Also, you can track investment fees, compare individual accounts, and set budgets for yourself based on how much you may be spending in various categories, such as dining and entertainment.

Hiring Financial Professionals


While apps are great, nothing can replace a face-to-face meeting with an experienced financial professional you know and trust. Therefore, always arrange to hire the services of a financial planner to help you during retirement. 



Since you will have various types of life insurance and possibly long-term care insurance as part of your retirement financial package, meeting with professionals from The Lofrumento Agency, Inc. and other financial offices can help you get the advice needed to make well-informed decisions.

Desktop Software


Even if you use apps, it is likely they may not have as many features as you need for certain areas of your financial planning process. Because of this, you may want to purchase desktop software that can go into more detail. 

For example, you can use QuickBooks Pro to monitor the assets of your estate, track the interest that accrues on municipal or corporate bonds in which you have invested, and track the yield to maturity.

Company Retirement Plans


Just as you are entering into retirement, take advantage of your company's retirement plans to help you track your financial assets. 

While you can make many decisions on your own, you can also take advantage of your company's HR department and others within the company to help give you advice on how to roll your money into an IRA, how to rearrange investments to reduce taxable income, and much more.

By taking an active role in tracking your financial assets when beginning your retirement, your later years can be filled with plenty of money and lots of fun.


Monday, June 28, 2021

4 Steps Seniors Should Consider When They Want to Downsize After Retirement

Downsizing is a great way for you to simplify your life and potentially save yourself some money, but that project is easier said than done. If you have recently retired and are ready to downsize, then you need to come up with a long-term plan that is going to streamline that process.

Cleaning


When it comes to any move, decluttering is always going to be one of the most important steps. Spending a little bit of time cleaning up your home and the rest of your property is going to make each following step that much easier. 

If you own the home and plan on selling it, then you might want to consider getting it professionally cleaned as well. Professional cleaning services are very affordable, and they could save you quite a few hours of work and get a deeper clean than you might be able to get.

Categorizing Your Belongings


Once your home has been cleaned, it is then time to begin the process of categorizing all of your belongings and decluttering. While that task might seem daunting, you can turn each room into its own separate project, going as quickly or as slowly as you need. 

As you go through your possessions, you should break them up by items that should be thrown out, given away, sold, and kept.

Finding the Ideal Living Arrangement


After you have gone through your entire home and all of your possessions, it will be much easier to determine exactly what kind of new living arrangements you are going to need. 



For example, you might be looking for an apartment or condo if you don’t want to deal with a lot of space or yard maintenance. If you expect to have family over regularly, you might want something with a little more space.

Instead of looking for a new home on your own, you should consider working with an experienced real estate agent who understands the local market. 

Explain to them exactly what you’re looking for in terms of location, space, maintenance, and other considerations. As long as you start your search early on, you will have plenty of time to find the perfect living arrangement.

Preserving the Items You Want to Keep


Even if you are able to get rid of a sizable portion of your possessions, you will still probably need to put at least some of your belongings in storage. 

Many people are surprised to hear that quite a few everyday items require climate-controlled storage so that they don’t become damaged. Luckily, those units are often fairly inexpensive if you sign an annual contract.

Older adults who are getting ready to retire and downsize should try to start this process as early on as possible. Downsizing is going to be easier and less stressful if you take the first steps a few years before you plan on retiring and moving to a smaller residence.



Sunday, June 6, 2021

How Smart Seniors Budget and Manage Their Money

Retirement gives you the freedom to experience life in a way that you may not have been able to when you were working full time. 

Creating a good budget and managing the money coming in each month allows you to get the most out of your golden years. Consider a few ideas on how smart seniors budget and manage their money.

Make Good Use of Free Online Tools


Knowing where your money goes is the first step to managing your money. Keeping up with spending on paper can be daunting and hiring a personal accountant can be expensive. 

Free websites like Mint.com can securely give you a complete view of your finances. All of your accounts will be connected on one easy-to-read page. Bills, credit cards, checking accounts, and subscriptions can be monitored so that they do not get out of hand. 

Mint will track your spending, give you insights on smarter spending, and even give you a daily snapshot of your net worth. If you like to have paper files, you can easily print reports for your records.




Find a Medicare Specialist


Fear of the cost of healthcare is one of the factors that keep people from retiring early. Health insurance options available to seniors in today’s market offer comprehensive healthcare without eating up a huge amount of your monthly budget. 

Getting help finding the right plan is as easy as looking for a broker who specializes in Medicare plans. Brokers who sell Medicare plans are usually paid by the insurance company. Helping you purchase a plan should not cost you any consultation fees. 

If a broker wants an upfront consultation fee, look for another one. An experienced broker will know which plans are accepted by your current doctors, cover your prescription medications, and give you coverage for health expenses wherever you travel on a regular basis. 

Some companies, like Optimized Health Plans, know that if you purchased a plan when you turned 65, you may not be locked into that plan for the rest of your life. If you have pre-existing health conditions, a Medicare specialist can direct you to plans that have little or no health screenings to change health plans.

Talk to other seniors about how they budget their retirement income. Seniors who are five to ten years older than you may be able to help you avoid pitfalls and extend your savings by informing you of what has and has not worked for them. 

Being on a fixed income does not mean limiting your freedom. Creating a detailed budget and managing every dollar that you spend will help you to enjoy every moment of retirement.


Wednesday, May 26, 2021

What People Won't Tell You But You Need to Know About Taxes and Retirement

Whether you have only recently retired or are preparing to do so in the next few years, chances are you may not feel as confident about the years ahead as you had hoped. 

From worrying about whether you have saved enough money to hoping you don't incur a major healthcare bill, these and other issues could greatly impact how your retirement plays out. Couple these issues with taxes, and you've got a mix that will undoubtedly keep you up at night worrying about this and that. 

While you may have read plenty about taxes and retirement, here are a few things you may not have known about but should regarding your taxes and retirement.

Social Security Can be Taxed


If you are not careful once you retire in regards to your provisional income, your Social Security benefits can be taxed up to 85%. Currently, if you are an individual making over $34,000 or a couple with at least $44,000 of income, expect the government to come calling with its hand out at tax time.

Take the Larger Tax Deduction


Once you turn 65, take advantage of the largest tax deduction to which you are entitled. If you are consulting with tax attorneys prior to or following your retirement, pay close attention to the standard deduction increases for individuals and couples, which are expected to be $1,300 and $2,600 respectively.



Keep Contributing to a Roth IRA


Even though you won't be able to continue making your contributions to a traditional IRA once you are halfway between ages 70 and 71, you can still keep on making contributions to a Roth IRA

Actually, there are no age limits on this, meaning you can make contributions as long as you wish. Also, don't forget that only after-tax dollars are contributed to a Roth, with qualified distributions always being tax-free.

Choose Carefully Where You Live


Like many people who retire, you may be looking to move from your current location to perhaps a new state. If you do so, make sure the destination you select is one that is very tax-friendly to retirees

For example, nearly 15 states impose taxes on Social Security benefits, while others have high income tax rates, sales taxes, and property taxes. If you're working closely with an attorney in planning your retirement, make this part of your discussion.

Rather than be one of the many who comes to retirement with more questions than answers, start planning as soon as possible to ensure your retirement goes exactly as you expected.



Monday, April 5, 2021

4 Ways to Find Insurance Plans That Work for You After Your Retirement



Now that you're approaching your retirement, you find yourself making many plans for your financial future regarding Social Security and other areas. 

However, you should not forget to take a closer look at insurance plans as well. By doing so, you can protect not only your health, but also your home, family, and many other important aspects of your life. 

If you are now looking for insurance plans that will work for you after you retire, here are four things to consider.

Travel Insurance


Considered the number one goal of most retirees, traveling the nation and perhaps the world may be one of your highest priorities. If it is, consider investing in travel insurance. 



Along with providing coverage for any medical or emergency treatment you may need while traveling, it will also cover cancellations, delays, and other circumstances.

Lifetime Annuity


While you will hopefully receive a Social Security check each month after you retire, chances are it won't begin to meet your expenses. To make sure you don't run out of money, you may want to purchase a lifetime annuity. 

Able to be bought from an insurance broker, it allows you to pay a certain premium in exchange for getting a predetermined amount of guaranteed income for the rest of your life.

Combination Life Insurance


If you want to have both traditional life insurance coverage and also have the security of long-term care insurance, it might be a good idea to invest in what is called a combination life insurance policy. 

Though generally more expensive than traditional life insurance policies, they usually provide many benefits that may become important as you age. Since most seniors spend well over $100,000 on long-term care after retirement, keep this option in mind when speaking to your insurance agent.

Supplemental Medicare Insurance


As you know, Medicare does not pay all of your medical expenses. Since you will still need to pay 20% of your medical expenses after Medicare pays its share, this can add up to thousands of dollars very quickly. 



If you want to avoid this problem after you retire, it is best to purchase a supplemental Medicare insurance policy from your insurance company. 

While this can reduce your costs to almost nothing, it can be very confusing figuring out which policy is best for you, which is why you should turn to an experienced insurance professional you can trust.

By choosing to be proactive prior to your retirement and getting these and other types of insurance in place, you can make your golden years more enjoyable than you ever imagined.



Thursday, March 18, 2021

4 Different Ways to Retire Comfortably in a Location You Love



Your retirement years should be as happy and fulfilling as possible. A big part of fulfilling your dreams is landing in the perfect location. The good news is that there's more than one way to cross the finish line of location perfection. 

In fact, depending on what your goals are, there could be two, three, four, or even more ways to retire comfortably exactly where you want to be. To help you plan well, here are some variables to consider.


Consider a Second Home


You might find that one location by itself isn't enough to contain the excitement of your retirement years. If that's the case for you, then a second home is the best way to go. For example, you can choose a home in a warm and sunny location to complement your other home that's closer to family. 

Since you'll likely be enjoying plenty of leisure activities while you're at your second home, you may be able to choose something smaller to save some money.

Find a Local Escape


If you like your current location, it's totally fine to simply stay in the area and make the most of your locale. By searching for new homes in your area that take advantage of great views of the local landscape, you can stay where you're comfortable while still feeling like you're on a retreat. 

This will prevent you from having to make a potentially expensive move and give you extra money to allow you to go on new adventures.

Go Maintenance-Free


Once you hit retirement age, the last thing that you want to be thinking about is maintaining a home. In addition to being time-consuming, many types of home maintenance can be downright expensive. 



That's why moving to a condominium or senior living community can make a great option. In addition to being zero maintenance, these housing options tend to offer plenty of activities that allow you to make new friends and make the most of your time.

Stay Mobile


If you have a strong sense of wanderlust, the idea of being tied to one or two fixed locations may sound like a terrible way to spend retirement. To satisfy your thirst for adventure, you can consider RV or travel-trailer living. 

This option allows you to take your home with you wherever you go so that you can explore all that this country has to offer without worrying about staying in a run-down hotel. 

Plus, once you make the initial investment in the RV or trailer, the costs of living on the road are fairly low compared to other housing options.

No matter which housing option you choose for your retirement, the most important thing that you can do is plan ahead. If you don't have enough money saved to afford one of the above options, you could find that your retirement is rather lackluster. 

With good planning, though, you can finally make your dreams come true and live in the location that brings you the most happiness.


Thursday, January 28, 2021

Downsizing to Keep Your Adult Kids Out


At present, having your 21- to 35-year-olds living back at home is becoming normal. As of July 2020, 52 percent of 18- to 29-year-olds were living with their parents based on a September 2020 analysis of data from Pew Research Center.

The majority of parents have good intentions and openly take their adult children back home represents helping them handle a temporary situation to save money, reduce their debt or get a stable well paying job.

But if the returning adult child continues to remain beyond the time limit, the new situation can be much more than just a small inconvenience, health specialists claim. 

Young adults who neglect to establish progress at their job, brush aside multiple opportunities they are presented with can negatively affect Mom and Dad's finances, postponing any arrangements to scale down and decrease retirement savings.

This puts further burdens on parents from the ages of 50s and up. So, you should understand the odds are very high that you're going to have less money when your adult child returns home.

If you're expecting your 20- to 30-something child to return home or you've had enough of them repeatedly returning every few months and want them to become more self-sufficient, here's what you should do.

  • Establish expectations early.
  • Make it somewhat uncomfortable by not having a spare bedroom.
  • Don't allow it to repeat.

Consider downsizing your home


Downsizing is the term for moving from a larger home into a smaller-sized home typically with less maintenance. For some people, this means a home with less land (grass, bushes, trees) to maintain or a home with less square footage and fewer unused rooms.




Downsizing occurs frequently for parents whose children are grown and left home. There is no longer a need for one or two spare bedrooms, being near to schools, or having a large yard. This group of homeowners commonly switches to a home that best suits their new lifestyle and for the rest of their lives.

The process is quite simple, you'll sell your home and move into a smaller home that costs less than your existing home. The proceeds from the sale of your current home can be used for living expenses, or a portion can be put into a money market account and instantly available for any investment opportunities that may arise.

This strategy may give you some flexibility if you buy the new home with all cash. You can also simply refinance your home, get a line of credit or apply for a reverse mortgage to help you. Each of these options sounds like a win-win.

The best thing to do is to figure out how much will be put down on the next home you're buying or the maximum amount you'll pay for rent, and how this will affect your monthly cost. Consult with an expert such as a financial advisor or estate planning specialist.


Friday, December 25, 2020

Planning for Retirement in the US as an Expat




For those foreigners who have lived and worked in the US for a while, retirement in America can be a great option. Planning for retirement as an expat takes forethought and careful financial planning. For many the process takes years. Fortunately, there are many ways for foreign nationals to have a comfortable retirement in the US.

401(k)


This falls under the ‘Defined Contribution’ type of retirement plan. Expats who have not yet secured a permanent residence can also invest in 401(k). This avenue lets investors set aside a part of their pre-tax income for retirement. 

It has the added advantage of reducing the taxable income. At the time of signing up, investors have options such as mutual funds, bonds, and stocks.

Sometimes employers match their employees' 401(k) contributions up to a certain percentage. For example, a foreign national working in the US for a local employer earns $50,000 annually and contributes $2,500 (5%) per year into his 401(k). 

If the employer contributes another 3%, the employee gets an additional $1,500 added into the plan per year.

Another option is the Roth 401(k) plan. It differs from the 401(k) in that it is funded with after-tax dollars. Roth 401(k) is gaining popularity because it comes with tax-free withdrawals.

IRA


Individual Retirement Accounts (IRAs) work much the same way as 401(k) plans, except for two key differences. First, 401(k) accounts are maintained by employers whereas IRAs are opened by individuals. 



People usually go to asset management entities or brokerage firms to start an IRA. Second, 401(k) plans restrict investments to a single option – stocks, bonds, or mutual funds. 

An IRA allows for a more diversified investment mix under one account. It can also include real estate investments. Note that IRAs are taxable at the time of withdrawal.

Pension


A large number of expats in the US send money online to invest in various retirement plans in their home countries. For those planning to retire in America, investing locally can make more sense. 

Pensions are among the simplest retirement schemes for expats who are formally employed by US firms. These require no major investments on part of the employees. 

Employers who maintain pension funds give fixed monthly benefits to their employees after retirement. The pension payment is determined by the annual salary during employment and the tenure of service. Pensions offer much better benefits to those who have been in long term employment.

Pension is generally calculated at 1.5% of the average annual salary times the number of years of service. For example, someone who earned an average annual salary of $60,000 over 25 years of service will receive a monthly pension benefit of roughly $1,875 after retirement. 

This figure may appear underwhelming. However, for most expats this is not the sole source of income. They look upon pension as merely an additional income. It is commonly combined with social security benefits and other forms of income.

Social Security


Expats who are in the US for the long haul are entitled to receive Social Security benefits. The amount of benefit is determined by credits an individual has accrued over the period of their working years. 

These credits can be re-calculated after each month. The Social Security Administration offers a Retirement Calculator on its website. Individuals can readily determine the age at which their desired benefit amount will become available.




However, first, you must contribute to the Social Security fund. Both employers and employees must pay 6.2% of the annual wages, up to a maximum of $137,700. Self-employed persons are required to contribute to the entire 12.4%. 

Further, individuals must accrue 40 credits to be eligible for social security benefits. 1 credit equals 1 quarter of a working year. One must work for 10 years to be eligible to receive these benefits.

The retirement age in the US is divided into slabs. This is also applicable to foreign workers. For persons born between 1943 and 1954 the full retirement age is 66. For persons born between 1955 and 1960 the full retirement age gradually increases by 1 year till it reaches 67. 

Individuals can opt for an early retirement age of 62. However, this will bring a reduction of up to 28% in the monthly benefit payouts.

Fixed income annuities


This is a type of insurance contract that may be used toward retirement benefits. Individuals can buy fixed income annuities from insurance firms and contribute to their post-retirement incomes with monthly payments. 

For instance, a person who wishes to retire at 65 starts investing $500 monthly at age 30. This person will receive an annuity payout of about $540,000. This sum can be withdrawn in monthly, quarterly, or annual payouts as a fixed income. 

Furthermore, contributions to fixed income annuities are not capped like IRAs or 401(k). One can invest in annuities without limit. For comfortable retirement experts suggest investing at least 5% of your annual salary into fixed income annuities.

About the author:


Hemant G is a contributing writer at Sparkwebs LLC, a Digital and Content Marketing Agency. When he’s not writing, he loves to travel, scuba dive, and watch documentaries.



Monday, December 21, 2020

Financial Steps to Take When You Are Ready to Retire




Retirement is an exciting proposition for many people, but it requires meticulous planning and considerable financial responsibility. In order to set yourself up for retirement, you need a sound financial strategy. Here are the financial steps to take when you’re thinking about retiring in the near future.

Commit to a Budget


Budgeting has long been the central component of financial planning. In order to save up for retirement, you’ll need to spend the coming years earning significantly more than you’re spending. While you’re likely used to maintaining at least a loose budget, your pre-retirement years call for a renewed commitment to rigid spending limits.

Check How Much You’ll Have to Pay in Taxes


When considering how much money you have invested for retirement, don’t forget to account for the taxes that you’ll have to pay down the road. Some accounts will allow you to withdraw money without paying taxes. 



Others, like a traditional IRA, will see your withdrawals taxed as regular income. If you fail to acknowledge these future taxes, you could make some dangerous miscalculations regarding your retirement finances.

Calculate Your Post-Retirement Spending


In order to determine if you’re ready for retirement, you need to calculate how much money you’re likely to spend in your twilight years. If you’re committed to a costly mortgage or severely in debt, then you’ll have to take this into account. Only when you know exactly what your expenses will be can you make a confident plan for retirement.

Pay Off Your Debts


Eliminating any outstanding debts is a great way to set yourself up for a steady retirement. Interest rates can seriously cut into your retirement savings. By paying everything off before you stop working, you give yourself a clean slate. This will give you a wonderful sense of freedom as you embark on your retirement.

Save Up for Unexpected Expenses


Don’t forget to account for unforeseen expenses that could crop up after retirement. You never know when an accident or unexpected incident could force you to dig deeper into your savings. Even if you’re on Medicare, there are some medical care options that your insurance won’t cover. To play it safe, it’s best to have a sizable rainy day fund set aside.

Planning for retirement is all about safeguarding your financial health. If you take the steps mentioned above, you should be able to ease into a carefree retirement.




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