3 Signs That Your Retirement Plan Needs Refresh

If you want to enjoy your senior year to the fullest, taking the time to plan for retirement is a smart bet. But if these things apply to you, it may be time to reshape your plan.

  1. You assume you only need 15 years of income – or less
    Americans live longer these days. If you retire in the late mid-60s, you have a good chance your savings will last 20 years or more. And so if you are planning a low year income, you can sell yourself less.

Of course, there is no way to know how long you will live. But you may want to err on the side of staying positive and increasing your savings rate to make sure you have enough nest eggs to stay healthy. Contributing an additional $ 100 a month or more to an IRA or 401 (k) plan can go a long way.

  1. You think you will only get fined on Social Security
    Many people assume that they will live a better life, primarily – or completely – on social security. In fact, if you are an average earner, that profit will replace about 40% of your salary. And if your earnings are higher than average, it will change even less.

Moreover, it is likely that social security benefits will be reduced in the distant future. The program’s trust funds may expire by 2034, at which time Social Security may not have sufficient income to continue the planned payments.

This is another reason to make changes to your retirement plan – that is, to take the lead in saving. Even if Social Security is not cut, you should only plan to give some of your retirement income, that’s not all.

  1. You think your healthcare costs will be reduced under Medicare
    Many people assume that once they register with Medicare their healthcare costs will be very manageable. Most of the time, the opposite happens.

Seniors on Medicare are responsible for many costs, from premiums to deductions. In addition, there are some essential services that Medicare does not pay for, such as dental care and eye examinations.

If you plan to spend less money on healthcare during retirement, you will resume some numbers. Fidelity estimates that the average 65-year-old man retiring this year will spend $ 143,000 on medical care, while the average 65-year-old woman will spend $ 157,000.

You are eligible, assuming you can set yourself up to manage these expenses better by depositing money in a health savings account (eligibility depends on enrolling in a high-deductible health insurance plan). Otherwise, you can increase your savings in your IRA or 401 (k) to meet future healthcare needs.

Planning for retirement is a smart thing to do, but it’s also important to have your planning spot-on. If these signs apply to you, you will have to revisit your plan so that you do not feel short of income in your senior years.

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Disclaimer: The views, suggestions, and opinions expressed here are the sole responsibility of the experts. No The Money Circles journalist was involved in the writing and production of this article.

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