addressing some of your retirement concerns
An important part of the role that we serve is helping to alleviate some of the concerns that our clients have surrounding retirement. Everyday, we work with people who are planning for an important phase of their life. It’s natural that people have concerns, and often they are the same from person to person.
It might help you to know that just as you are not alone in your retirement preparation, you’re likely not alone in the concerns you’re having.There are three concerns in particular that nearly all retirees and pre-retirees share: running out of income in retirement, finding affordable and reliable healthcare plans, and navigating a volatile market. Fortunately, there are ways to help you fee like you’re doing something to make sure those concerns don’t become a reality.
Concern #1: “I’m nervous that I’m going to run out of money in retirement.”
Among the three, the number one concern that many people have is outliving their money. They want to be sure that they will have income for life.
Many people find some relief in having a retirement strategy that helps provide income for life. Part of the retirement strategy is setting a target amount for how much you’ll need, a target date for when you’ll need it, and adjusting your lifestyle to help you get there. Even though everyone’s income needs are different, the general rule of thumb is that a retiree will require 70 to 80 percent of their pre-retirement income to maintain their current lifestyle.
Once you figure out your target amount, the next step is to explore beneficial financial strategies, options, and tools to help you achieve your income goals. There are a handful of ways to get there, and Social Security is one of the most well-known. It plays an important role in many Americans’ retirement strategies, and it is beneficial for them to know how to properly manage it in order to maximize their benefit.
There are also a number of other tools that your financial services professional can review with you.
Concern #2: “I’m worried that I won’t be able to afford the medical care I’ll need in the future.”
Your retirement strategy should address your healthcare needs and concerns. Having a comprehensive and affordable health insurance strategy is more than just a critical component in your retirement strategy; it’s a critical component to ensure your quality of life. There are various
ways to accomplish this but for many retirees Medicare is the most important. Medicare guarantees health insurance for people older than 65, with certain disabilities or with certain diseases. It is similar to Social Security in that it’s a federal social insurance program that you have contributed into over the course of your career. It is important to understand your Medicare coverage so that you can get the most out of it, and create a strategy to insulate your retirement savings so that it doesn’t run them dry.
The majority of Medicare recipients also purchase a supplement to ensure their coverage level matches their healthcare needs.
Concern #3: “I’m uncomfortable with the potential ups and downs of the market.”
When dealing with a volatile market, the most difficult challenge can sometimes be managing your emotions. Investing for retirement can be a difficult process. You want to make sure you have all the necessary information you need to make an educated decision. One that will benefit you and your loved ones in the long run.
Understanding why you have certain holdings and assets provides you with the knowledge of how to properly handle your retirement strategy. For example, if the market becomes unstable, you can have the confidence to make well-informed decisions, rather than making a panicked decision to compensate for the unexpected change.
No two retirees are alike. It is important to understand your needs and goals for retirement and have a retirement strategy tailored to your objectives, risk tolerance and time horizon. Working with your financial services professional can help you get there.