Posted by Fred Lake

Worried About Retirement: These Moves Can help You Plan Ahead

Worried About Retirement: These Moves Can help You Plan Ahead

It is normal to freak out at the idea of getting out of service. It is normal to dread retirement as it is a complete change of lifestyle. Think of it, the fear of the unknown in terms of expenses and what your health has in stock. 

As a result it is normal to be worried when you are about to retire. However, you can alleviate the worry with these tips discussed below:

Understand the Time You Have

For you to have an effective retirement strategy, you need to the time you have till retirement. If your retirement age is still ahead, you have enough time to plan and you can involve yourself with high risk portfolio and investment. Young people below the age of 40, for instance, can invest in stock and other risky investment. Even though stock is highly volatile, it performs better than bonds in the long run. 

For old people, however, the priority should be on preserving capital and generating income. As a result, bonds, for instance, is less volatile and will give you an income to live on. There is also no need to worry much about inflation. A person who is retiring in the coming year, for instance, need not worry about a rise in the cost of living compared to a young person that recently joined the workforce.

Increase Your Savings 

The main worry when people are about to retire is money. As a result, it makes sense to make more money available via savings both for general needs and healthcare related needs. With this, you will be able to take care of your bills when they come. It is a good thing that many popular retirement savings plan like 401(K)s and IRA come with catch-up provisions for senior workers. This allows you get a late-in-the-game boost in your savings.

In the present year, people at the age of 50 and above can save as much as $26,000 in a 401(k) or 7,000 in an IRA. For younger workers, however, the limit is $19,500, and $6,000, respectively. For people with 401(k) and you have five years before retirement, you will have an extra $143,668 with what you already saved if you max out at the level you are. This is true, provided your investment gives a 5% yearly return 

It is not only your 401(k) or IRA that you should max out. If you can, max out your health savings account or HAS if you qualify. You can make a contribution of up to $3,550 for yourself in the year or as much as double that amount for your family. For people 55 years or older, there is the grace to have an extra thousand dollar on the limit they already qualified for. 

In case you forget, HSA funds do not expire hence, it can be transferred to retirement. This can help take care of your health when you retire. 

Maximize your Social Security benefits

As a senior, you should always aim to get the most you can from social security. This will give you more financial flexibility in your golden years. The good news is there are several moves you can make to boost your flexibility. One of the most common moves is to claim only when you get to your full retirement age, which can either be 66 or 67. Another good news is that for every year you delay holding off the benefit, you get an 8% increase till age 70 when the increase stop. 

Another way to boost your social security benefit is to try and get a raise as early as possible in your career. This is because your earnings is directly related to what you can collect. Also, extending your career, no matter how little can boost your earnings. Your earnings will be calculated with regards to the years in which you had the highest pay – usually 35 years. For those that earn more towards the end of their carrier compared to what they were earning earlier, they can replace some years of low earnings with better income. This increases the monthly retirement benefits. 


It is a natural feeling if you dread your days of retirement. It is, however, a futile effort to fret over this. You can make plans to make your senior years comfortable. We have discussed three solid plans that will save you of stress and help you enjoy your golden days. 

Fred Lake
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