More and more Americans are living longer and healthier lives. But, planning for that life during retirement can be hard to do. In some cases, retirement can mean a limited amount of money and no idea on how long you’re going to need to make it last. Ask yourself the following questions to see how to make your retirement savings last longer.
Am I really ready for retirement?
Use a retirement calculator to get a rough estimate of how much you’ll need to live comfortably during retirement. You may also want to talk to a financial advisor, since he or she may be able to draw on specific details that a retirement calculator can’t pick up on and help you arrive at a more realistic figure.
Do I need to change my housing arrangement?
It might make more financial sense to sell your $200,000 house and move into a smaller, $90,000 condo to save on your housing costs. If you want to keep your home, follow the lead of Felix Unger and Oscar Madison, and consider sharing the living expenses with another person. Also, don’t rule out living with a family member. This may give you a chance to pay less in housing costs in exchange for other services like babysitting or minor home repairs, not to mention adding more family time to your life.
Do I need to work full time a little longer?
You may need to delay retirement and continue working for a while longer. This option could give you more time to contribute to tax-deferred investment accounts and a chance to postpone withdrawing funds from those accounts early. If you leave your money in a little longer, you’re giving your savings more time to grow. In short, the longer you remain in the workforce, the less you must save for your retirement years.
Do I need to work part-time during retirement?
Working after retirement — at least part-time — may be a necessity, but it doesn’t have to be the same career you just had. Consider part-time work making money from a hobby you enjoy or with a local non-profit who could benefit from your expertise, for instance. This way you earn extra income and continue to interact with your local community.
Can I delay collecting Social Security?
If you begin collecting at age 62 your Social Security benefits will be greatly reduced. However, if you can wait a few years to collect, your payments will increase about eight percent each year up to age 70. Therefore, you should determine the best time to start receiving payments in order to receive the most benefit. Contact your nearest Social Security office to better understand your options.
Do I need an investment check up?
Talk to your financial advisor to see if it’s time to modify your investment strategy. Maybe the market has changed since you last reviewed your financial plan. Or perhaps it’s time to invest more conservatively.
Whether you’ve applied for retirement or are still thinking about it, use these tips to help stretch your savings.
Article provided by Local Government Federal Credit Union.
The advice given is for informational purposes only. Contact your financial advisor for additional guidance.