Ensuring an Income During Retirement
For many people on the verge of retirement, the anxiety surrounding paying for their needs during the most fragile years of life is a daunting one. Despite sensible 401k contributions, pensions, and other retirement safety nets many boomers on the verge of retirement still survey as being at least a little dependent on social security to meet a lot of their needs. The uncertain future of social security and the recent jump in inflation creates a difficult problem for those on the verge of retirement.
Luckily despite the cultural anxiety surrounding the future of social security, it seems here to stay at least for the moment. Nevertheless, many retirees depend on more assets than just social security alone to have their needs met. Remember that most of your medical expenses will be spent in the remaining ten years of your life so careful and responsible planning is a must. With so many complexities surrounding tax codes and finances, what are some basic strategies you can adopt to give yourself as stable of a future as possible?
The most obvious strategy is to start saving as much as you can as soon as you can. The old saying rings true that the best time to invest was yesterday but the second-best time is today. Just as setting aside finances to cover large assets like a home or a car is important so is saving for the most vulnerable years of your life. Remember that no one will save for your retirement but you. Contribute as much to your accounts as you can afford and only retire when you feel confident enough to have your needs met. Meet with a financial advisor and try to work out the best saving and asset management strategies you can adopt to help yourself later down the road. Remember that long-term planning and strategy work better than short-term gains.
If you’re on the verge of retirement right now, there are a few unique strategies you can take to give yourself a better income. If you are going to rely on social security to help pay for a lot of your needs consider limiting your income just before and during your collection period. The higher your stated income is the greater your social security withdrawals will be taxed. Consolidate your assets and withdrawal from accounts that will limit the amount you pay in taxes. With the right plan in place such as a combination of an IRA, RMD, and social security it’s possible to have an income that should adjust well with inflation. If you’re looking to get a bigger break from taxes consider donating some of your unused solid assets to charity. These could be anything from antiques to works of art. No matter how little you personally paid for them, once appreciated a charity will take them at full value. Despite the anxiety surrounding retirement and the stresses that come with getting older, you can minimize your worries with a few easy steps you can take now.
