DEBT. To maintain a predictable cash flow in your retirement
years, make every effort to pay off your consumer and credit
card debt before you retire, and don’t borrow money during
retirement unless you know precisely how you’ll pay it back.
Consider the 10 years before retirement as your “debt‐
reduction” decade.
FRAUD. You’ve worked hard building up retirement assets. Now
you need to protect them. Older Americans -- even those who
are experienced with investing and are financially literate
-- are highly targeted by scammers, misleading advertising,
and fraud, so be especially on guard. Make no money decisions
quickly, and never without getting a second or third opinion
from people you trust. If it sounds too good to be true, it
almost always is.
HOME & MORTGAGE. A house may be your biggest asset, but be
careful about viewing the value of your house as it were a
retirement plan. Housing prices fluctuate and you need other
forms of savings. It’s best to plan that a home’s equity is
one of the last assets you use in your retirement
INSURANCE. Your retirement spending plan is not complete until
you know how you will pay for medical and long‐term care needs. Insurance companies also sell many forms of annuities. Putting
at least part of your retirement savings into an immediate fixed
annuity that will give you a monthly payment for the rest of
your life creates a regular source of income.
PENSIONS. Your employer pension is an annuity that gives you a steady “paycheck” for your retirement. Even when you’re retired,
saving some of your pension benefits is a good way to protect
yourself from inflation and ensure you have enough money for your
later years.
RETIREMENT ASSETS. You do not know whether your retirement will
last less than 10 years or more than 40 years. To be prepared
for reaching advanced age, continue saving and making wise
investments even during your retirement. At retirement, most
retirees still need to invest in diversified assets that may
need to last decades or help weather investment market turmoil.
SOCIAL SECURITY. Taking Social Security payments too early
means receiving less money each month than you would receive
if you waited for even a few years. If at all possible, do
not begin taking Social Security until you are at least your
full retirement age [66 for most nearing retirement]. If you
take Social Security benefits at age 62, your benefit will be approximately 25 to 30 percent less than if you have waited
until your full retirement age. For an even bigger benefit,
wait until age 70, when your payment will be at least 75
percent higher than if you started taking benefits at 62.
WORK. If you are healthy, aim to work at least until your
full retirement age. It produces many benefits, including
prolonging any health care coverage you have, building your
retirement assets, and increasing your ability to reduce debt.
