If you’re nearing retirement age, you’re probably thinking about what it takes to prepare for retirement. You’re not the only one, of course – lots of people wonder what it’s going to take to get all their ducks in a row. There are just so many different questions you need to answer, especially when it comes to things like your financial and living situations!
Truth is that preparing for retirement has never been a walk in the park. It can be even more difficult today thanks to the effects that the COVID-19 pandemic has had on local and global economies. Still, there are plenty of guidelines to follow. Here’s what you need to know about what you can do to prepare for your own retirement!
The Sooner You Start Planning, the Better
It might seem like the height of folly to rush headlong into retirement. Yet dragging your feet might not be the best decision, even if it feels like you’re playing it safe. Financially, it’s always better to retire sooner than later. On the one hand, this does raise a worry about not having enough time to build up that nest egg through savings and investments, but a significant amount of those savings gets eaten away as your cost of living continues to escalate over the same years you’re saving and investing. Those costs can include home maintenance and repairs, property taxes, and unexpected healthcare costs. You can avoid these costs by moving to a retirement community. This doesn’t mean that you need to stop working, you can always work part time or set up your own business, but it does give you the freedom to travel without worrying about your home, live with the knowledge that your healthcare is included in your monthly bill, and not worry about a changing housing market.
Don’t forget that inflation is always active! It’s a constant in that it’s slowly but surely depleting the value of the money you have. Unless you can guarantee that your inflation-related cost of living increases will be outpaced by the growth of your savings, it’s going to be advantageous to retire earlier rather than later. Doing so keeps healthcare, living arrangements, and your other retirement-related costs more immediately affordable.
Going to Age in Place? You May Need to Rethink That
Speaking of living arrangements, many people considering retirement often assume that they will simply continue living in their existing homes. This process, called “aging in place,” offers the advantage of keeping you in familiar surrounding you know and love. But the drawbacks of aging in place often outweigh any possible benefits. When you take maintenance and repair costs into account, utility bills, property taxes, and everything else that goes into keeping a property in good condition, aging in place often becomes more expensive than you think. Plus, you as you continue to age you will very likely need to adapt your home for for safety!
If you’re looking to live comfortably and do so more affordably, there are plenty of options out there. One of the most popular involves selling your existing home and using the proceeds to move to a retirement community. These residential communities are perfect for a senior looking for a zero-maintenance home. The best part is that these communities are often affordable enough that you can use the remaining revenue from the sale of your old home to bolster your retirement savings even more.
Click here to read more about the pros and cons of aging in place.
Don’t Forget Healthcare
Once you’ve made a decision about where you’re going to live during retirement, it’s time to think about your overall healthcare needs. Keeping yourself in good health is something you’ll need to do as you age, as this will grant you the quality of life you want for your retirement, enabling you to enjoy yourself without having to worry about physical limitations. The problem when a health issue does arise is that Medicare simply does not cover all your possible medical costs besides routine ones – and as our physical needs change as we get older, you may need access to more advanced healthcare. The unknown costs of accessing this level of care is a major worry for many people planning for their retirement.
Sadly, the cost of healthcare continues to rise rather quickly year on year. Just as inflation and cost of living increases can eat away at your savings and investments, so too does it begin to price you out of healthcare – especially if you have to pay out of pocket. Thankfully, there are affordable options open to retirees who want to ensure their healthcare costs remain stable and within reach. Retirement communities that offer a continuity of care are one such option, as they provide future-proofed healthcare for the entirety of a resident’s stay by contractually locking your healthcare costs at the time of move-in. This can save you quite a bundle in the long run, as you can remain sure that your monthly maintenance fees won’t go up solely because you need to move into assisted living or skilled nursing care, as an example.
Click here to read Does a CCRC Make Sense for You?
Other Things to Consider When Planning Retirement
Much of your retirement planning activity will be predicated on things such as financial constraints. This is only natural – no matter how much you’ve saved or how well you’ve invested, there are always worries that it might not be enough. The financial turmoil that followed the coronavirus outbreak is proof positive of that, as local and global economies have been slow to recover in its wake. By the same token, there are other things to consider besides whether you’ll be able to afford your retirement.
Remember that retirement is supposed to be a reward for a life spent working. Seniors who hang up their hats for the last time can finally kick back and relax, finally enjoying their free time and filling their days with what they want to do instead of what they are obligated to. This means there’s now time to socialize with friends, spend time with family, pursue hobbies, and do anything else that you’ve always wanted to do. In many ways, the financial decisions you make for your retirement will help you achieve these other goals; a good retirement community, for example, will have the types of amenities that you can enjoy right at your fingertips. Having fitness centers, swimming pools, art classes, and more right on-premises provide you with ample opportunities to enjoy this next chapter.
It’s Time to Start Planning for Retirement
Planning for retirement doesn’t have to be fraught with uncertainty and worry. As long as you have a solid solution for your healthcare and housing-related costs that also provides plenty of space for actually enjoying your retirement years, you can rest assured that the remainder of your planning questions will fall into place.
Want more information about preparing for retirement? Read these articles by Acts-Retirement Life Communities.