Getting Ready to Retire

As you prepare for this next chapter in your life, we can work with you to help keep you on track to achieving the retirement lifestyle you have in mind.

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Our retirement planning experts can help you set realistic expectations for your retirement income and expenses, create a strategy for withdrawing your assets, and explore avenues that will help manage retirement income.

Keep in mind, the moves you make in the time leading up to retirement can help set the stage for a financially secure future. Here are 10 tips to help ensure you’re ready to enjoy this exciting next phase of life.

1. Put your financial house in order.
Organize and update your legal documents, including your will, financial and medical powers of attorney, any insurance policies you may have, and make sure your beneficiaries are up-to-date. It’s also smart to make a list of important financial information that you safely store online or in a safe deposit box.

2. Make a retirement budget.
Take inventory of your sources of retirement income and decide how you’re going to use them to support your lifestyle.  Then add up your anticipated retirement expenses and see if there’s a gap. If so, consider ways to cut the cost of your retirement, or determine if your savings will sufficiently supplement your income.

3. Boost your savings.
If you’re still working, take advantage of catch-up contribution provisions for those 50 and older that may allow you to contribute extra amounts annually to your traditional or Roth IRA, 401K or other employer-sponsored plan.

4. Make a date with your benefits department.
Your benefits representative can help you understand your retiree benefits, particularly your pension.

5. Understand what Medicare covers – and what it doesn’t.
You can sign up for Medicare as early as three months prior to your full retirement age. Before you do, make sure you understand your options. If you plan to retire before Medicare kicks in and your employer doesn’t offer retiree coverage, arrange for interim health insurance.

6. Prepare for the unexpected.
Review your insurance plans and consider long-term care coverage to help protect your retirement funds. The sooner you do, the less expensive it may be.

7. Consider Social Security options.
You can claim Social Security any time between ages 62 and 70. However, the longer you wait (up until age 70), the larger your monthly payout will be. If you’re married, you have options that can help you maximize the benefits you and your spouse receive.

8. Evaluate your 401K options.
If you own company stock in your 401K that has increased in value, you may want to take possession of the stock instead of rolling it into an IRA. Doing so may enable you to take advantage of much lower capital-gains tax rates on the growth, or net unrealized appreciation (NUA), of the stock.

9. Stretch your IRA benefits.
If you inherit an IRA from a spouse, consider your options before taking a distribution. Careful planning can help extend that account’s tax advantages and prolong the life of the account across multiple generations.

10. Watch for required minimum distributions from you retirement accounts.
Most employer-sponsored retirement plans and traditional IRAs require you to start taking distributions at age 70.5. Otherwise, you’ll face a steep penalty in the form of a 50% excise tax on the amount not taken.

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