4 Questions to Ask About Your Retirement Income Plan

​For many people, retirement planning is all about saving money. Your retirement strategy may consist of contributing to a 401(k), an IRA or even a health savings account. When you’re young and have many years until retirement, asset accumulation may be your top priority.
 
As you near retirement, however, you may want to think about more than just dollars and cents. Asset accumulation is important, but you also may want to think about how those assets will be used in retirement. That means asking yourself questions about your desired lifestyle.

Below are four questions you may want to ask yourself as you develop your retirement strategy. These questions can help you think beyond the financial aspects of retirement planning. They can also inform your spending decisions in retirement so you can protect your assets and your financial stability.

How will you spend your time?       
You may be excited to leave the constraints of the working world and have your schedule all to yourself. However, many new retirees often struggle with an empty schedule. They may feel that they lack purpose, and some fill that free time with costly activities like shopping and travel. The risk is that you spend too much money in the early years of retirement and deplete your assets.
 
Take some time to think about what you want your retirement to look like. What would your perfect day be like? What activities are most important to you? How would you like to spend your time? Then think about how you can achieve these objectives in a cost-effective manner that won’t bust your budget.


What relationships are most important to you?
Many retirees also struggle with loneliness. While you may be excited about leaving your job, you may find that you miss the people you worked with. Work is often a primary socialization opportunity for adults. Without work in your life, you could have limited opportunities for interaction with others.
 
Think about how you’ll stay connected with people after you leave your career. Are there any local clubs or hobby groups you could join? For instance, if you enjoy gardening, could you participate in a local club or volunteer in a civic group?
 
Also, think about your relationships with your family. Many seniors love to spend time with their children and grandchildren. You may even want to spoil them with gifts and financial assistance. However, be aware of how those gifts can impact your own financial stability. Look for opportunities to spend time with your loved ones without threatening your own financial future.


Where will you live?
Your living situation can be a big factor in your financial stability and quality of life. It can also have an impact on your budget. Retirement may be a good time to consider downsizing, especially if you’re living in a large home in which you have equity. By selling your home, you could reduce your expenses and pad your savings.

Also, think about your neighbors and surrounding community. By moving to another part of the country or even a different neighborhood, you may be able to reduce your cost of living. If you live in an area with businesses within walking distance, you may be able to get by with one car instead of two. A change in location can have multiple positive effects on your budget and your happiness.


How will you minimize the risk of illness or injury?
As you get older, you may find yourself more vulnerable to illness and injury. Health care is usually an important area of concern for many retirees, and it can be a major expense. Fidelity found that the average retired couple will spend $275,000 on out-of-pocket health care costs.1
 
Medicare will help cover some of the costs. However, you can reduce your risk and exposure by investing in your own health. Think about ways to improve your wellness. Perhaps you could reduce or eliminate unhealthy habits. You may be able to improve your diet or exercise more frequently. Your doctor can help you develop a health care plan that minimizes your risk for serious health issues.
 
Ready to develop your retirement strategy? Let’s talk about it. Contact us today at UBC Retirement Income Planning. We can help you analyze your needs and implement a plan. Let’s connect soon and start the conversation.

 

1https://www.fidelity.com/viewpoints/retirement/retiree-health-costs-rise
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
17597 - 2018/4/19