Post-Retirement Finances: Senior Financial Planning
Monday, December 9, 2019, 6:00 AM | Leave Comment
Financial literacy isn’t something that is taught in schools and sometimes, you don’t learn about it at home either.
As you progress through life, you gradually begin learning how important managing your money is. You may also notice that there’s always an emphasis being placed on planning towards retirement.
Have you ever thought about the importance of planning your finances after you retire?
Although many people may not think about it, you will have financial matters to address once you reach your senior years. For instance, you may want to think about how you can grow your nest egg even further, how to be more financially savvy and how to create a home that accommodates your unique needs.
The reality is that you never stop learning and growing, and the same can be applied to your financial knowledge.
Having said that, you’re going to find the many aspects of post-retirement finances that you should be aware of in the article below.
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Develop a Money Management Plan
It can be a great feeling knowing that you’ve reached your retirement years and have been able to build a decent pot. That pot will likely need to sustain you throughout your post-retirement years, which is why you need a plan for your money. This plan should consist of a budget which you can draw up on your own. Alternatively, a qualified accountant or bookkeeper could help you do the job as they may be more knowledgeable about ways you can save through taxes and other means.
When developing a money management plan, it’s important to include how you will pay off any outstanding debts. Not everyone can clear all of their debts off before they retire, which means you’ll need to consider and plan for how you will deal with those expenses. If you need assistance, get a professional on board so that they can advise you on the fastest and most cost-effective way to go about it. If, for instance, you have home debt, then they may advise you to refinance your mortgage. However, you’d need to be sure you can secure a shorter mortgage term and are financially capable of handling the higher payments.
For those who choose to manage their finances on their own, there are many apps and resources to keep you on track. Most banks have apps that provide expense tracking features so you can see how much you’re spending and develop a budget. When budgeting, remember to always plan for contingencies and emergencies. Also, protect your nest egg by learning about new developments in the finance sector and seeing how they could affect your investments and savings.
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Put Estate Plans in Place
Most people don’t want to think about death, but it is a reality that everyone will have to face at some point. You should, therefore, start drawing up a plan for your estate that details how it’s going to be distributed. Do your estate planning with a reputable lawyer and ensure your wishes are legally binding.
To be organized, develop an estate planning file so that if you unexpectedly pass away, all the information needed to handle your affairs is easily accessible. Your file should have items like current estate planning documents, burial plan information, and old tax documents in case an audit needs to be carried out. Other documents that you may want to include are life insurance policies from former jobs and letters to your loved ones.
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Ensure Living Costs Are Covered
Living costs should be taken into consideration when planning post-retirement finances. Where you’re going to live and what assistance you’ll need to live a comfortable life will all have a significant bearing on your finances. Basic amenities like nourishing food, electricity, and clothing should be included in your overall costs. When thinking about living costs, you also want to create a flexible budget as inflation could mean you end up paying more for these things in the coming years.
Taking the time out to assess your health and decide whether or not you’ll need senior care is also vital. If you have a history of health challenges or genetics that suggest you could, it’s a cost you should factor in. Aside from dipping into your personal pot for such expenses, see if you’re entitled to any support from resources such as Medicaid, Medicare, retirement benefits from former employers, or social security. Even if you are able to do most things on your own, you may still want assisted living to help with basics around the house. In case you aren’t familiar with what assisted living entails, it can include mundane activities such as laundry, house cleaning, and cooking meals.
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Decide What to do with Valuables
Valuables are another thing you’re going to have to decide what to do with post-retirement. You could choose to will them over to loved ones when you pass away so that they have something to remember you by. On the other hand, selling them if they’re profitable items may be a more suitable alternative for you.
If you have military memorabilia like challenge coins, you could plan for them to go to a loved one or donate them to a local chapter of a military organization such as the Veterans of Foreign Wars. Other collectibles could be sold to make ends meet if need be. Figuring out what you want to do with your valuables beforehand gives you peace of mind that they’re well planned for.
Aside from this, home safety is another factor to take into consideration. For example, you may want to install a medical alert system that will inform emergency services if you happen to injure yourself. Another form of home safety would be having a safe and secure railing out on your deck if you’ll be spending time outdoors.
Planning your finances as a senior can be daunting, but it can also be empowering. Knowing that you have complete control over your money and can use it to create the most comfortable life for yourself is something worth being proud of.
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