50 or Older? Here are a Few Retirement Questions Just for You

anyone in their 50s, who wants to have a successful retirement, is advised to start getting their thoughts organized.

You don’t need to create a spreadsheet or write a book-length plan, but anyone in their 50s, who wants to have a successful retirement, is advised to start getting their thoughts organized.

MP900448491Research shows that people who have more specific ideas of how they want to spend this part of their life, end up being more satisfied that those who just wing it. We think that’s because those who create a plan have also devoted some time and energy to considering what retirement means to them, what issues they may face and what is meaningful to them.

Forbesrecent article, “5 Key Retirement Questions You Need To Answer When You're 50 Or Older,”boils it all down to a few key ideas.

How long will retirement last? Your plan will be vastly different, if your life expectancy is 10 years than if it is 30 years. Most folks underestimate average life expectancy, and that can result in financial distress in the later years of retirement. Check online sources to determine the average life expectancy for your age group.

When will you be ready to retire? This answer frequently determines how satisfied you’ll be in retirement. Remember that your age shouldn’t determine your retirement date. It’s retirement readiness that counts.

What are you going to do in retirement? This also includes how you think you’ll spend your financial resources. Create a personalized spending estimate, based on your interests and planned activities. Decide the lifestyle you want in retirement and estimate the current costs. Most people spend less as they age because they’re less active. However, it might increase later in life because of medical and long-term care expenses. Add inflation into your estimates because most of what you’ll spend money on in retirement will go up in price over time.

When will you be able to retire? Being able to retire means your income and assets are enough to let you to maintain the desired standard of living. Unfortunately, the retirement date isn’t always in your control, so add in a contingency that you might retire before you want due to health or layoffs.

It is difficult to estimate medical expenses and long-term care in retirement. Many new retirees underestimate these costs and overestimate what Medicare and other government programs will pay. It’s wise to maximize insurance coverage. Sign up for a Medicare Advantage plan or join traditional Medicare and add a Medicare supplement (Medigap) plan and Part D prescription coverage. Your fixed monthly expenses will be more with the insurance premiums, but your potential maximum out-of-pocket expenses will be less.

How realistic are your plans regarding managing and spending down your nest egg? The most common mistake retirees make is overspending in the early part of their retirement, which often leads to needing to make major adjustments (or moving in with the kids) later in life. Have an investment strategy that can be modified as circumstances, like health care costs and market swings, require. Be flexible—what works when you are 70, may need to be revised when you are 78. Retirement finances are never “set-it-and-forget-it” plans.

Reference: Forbes(April 3, 2018) “5 Key Retirement Questions You Need To Answer When You're 50 Or Older”