5 Retirement Planning Tips
Retirement planning is complex. We often hear of tips on how to fund retirement accounts and invest our money. Here are five tips that you don’t often hear.
To keep financially fit, keep physically fit. The largest expense for many retirees is healthcare. Many chronic illnesses can be avoided if you are physically active, maintain a healthy weight and are nutritionally conscientious. As an added bonus, the better you feel, the more you’ll enjoy retirement.
Plan appropriately for inflation. We all know that it will take more dollars to do the same job over time than it does today. Various expenses have different inflation rates. Historically, inflation has trended higher for medical and healthcare related expenses so if you have a higher cost maintaining your health, plan for increases accordingly.
Identify which assets you’ll use for retirement income, and which assets you’ll just use. I’ve had clients who are intent on paying off land or a cabin rather than maximizing retirement contributions. If you do not plan to use the land or cabin as retirement income through a sale or rental, be sure you are channeling an appropriate amount of money toward funding of future retirement income sources like IRAs and 401(k)s.
Understand income taxation in retirement. IRAs, ROTH IRAs, Social Security, non-retirement investments, and assets subject to capital gains are a few categories that come to mind that differ in taxation. Additionally, your taxable income will affect things like health insurance or medicare premiums. Single versus joint filing makes a significant difference as well. If you are married filing joint, the time will come when one of you becomes a single filer, with the passing of the first spouse.
Plan for the financially unexpected. When you identify your retirement income needs, financial wants and wishes, bake into your formula a margin for error and a cushion for unexpected expenses, because they are bound to happen.
Make the most of your golden years by planning for them.
LouAnn Schulfer is co-owner of Schulfer & Associates, LLC Wealth Management and can be reached at (715) 343-9600 or firstname.lastname@example.org. www.SchulferAndAssociates.com, louannschulfer.com or louann.biz
Securities and advisory services offered through LPL Financial,a Registered Investment Advisor. Member FINRA/SIPC.