With 10,000 Baby Boomers running towards retirement each day, there is plenty of talk on how retirement accounts are not adequately funded, mortgage balances are still being paid on, and the amount of outstanding credit card debt continues to soar. Certainly, this is not the ideal financial situation they imagined. While Baby Boomers continue to defy the picture of aging by maintaining a youthful existence, keeping the current lifestyle will be impossible without a few changes. By successfully preparing for retirement, perhaps the nest egg can stretch even further and precious golden years can be spent checking items off the bucket list stress-free.
Ensure Proper Long-Term Care Coverage
The cost of long-term care is a primary concern when it comes to retirement. Let’s face it, we’re going to get old and need eventually need care, unlike auto insurance where you’re paying for ‘just in case’. While health insurance covers the medical portion, long-term care can assist with daily activities such as eating, getting dressed, or simply getting around. This includes care in facilities such as assisted living, or even home care. While premiums can be high, it’s a good idea to review available options based on income level and whether or not it is a necessary plan for you.
Reduce Unnecessary Spending
While there may not be a spending spree occurring every month now, but as a more fixed income approaches, the need to hang onto every dollar coming in takes more of a priority. A great place to start would be to track current spending by reviewing the last debit or credit card statement and look for areas of improvement. Sure, going out to eat is easier than having to cook and clean yourself, especially if you tend to avoid the kitchen, but the costs quickly add up compared to what it would cost meal prepping after grocery shopping.
In addition, although it may have become routine to flip channels over the last few decades, having a cable bill may now be obsolete. As you think about which channels are currently viewed regularly, live vs. DVR, keeping only a streaming service and cutting the cable cord could make the most financial sense. The extra savings can help pay off debt so you can go into retirement without costly monthly interest payments.
The thought of remaining at the daily grind any longer might make you cringe, but it just may be a necessity in order to set up the finances for long-term success. If Social Security benefits will be a majority of the income in retirement, then pushing an extra few years to maximize monthly payouts could make a significant difference. It will also give a chance to continue with retirement contributions to build a nest egg, more time for an adequate emergency fund to have on hand for a financial cushion, and proper healthcare coverage. The opportunity for part-time employment may be an option instead of the typical stressful environment that occurs today, in order to continue with coverage while on the payroll.