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 CREATE A PLAN FOR LONG-TERM CARE

In 2016, the average cost for a semiprivate room in a nursing home was $6,844 per month. For a private room, it was $7,698 a month.

Do you have a plan for long-term care? If not, you should consider one. With our increasing longevity, more of us than ever will need some form of long-term care (LTC). And with price tags like the ones above, long-term care could decimate your retirement assets if you aren’t prepared.

Since many people won’t be able to cover costs out of pocket, one way to prepare is to buy LTC insurance. Coverage, however, can be pricey. In deciding if insurance is appropriate for you, think carefully about how long you are likely to live and what assets you will have available to pay for care.

DECIDE WHETHER YOU SHOULD SELL YOUR HOME

The five-year marker before retirement is a good time to decide what you want to do about your home.

Downsizing or relocating could be a smart financial move. For example, if you bought in a neighborhood because it was close to good schools, you could sell the home to a young family and buy a less expensive property somewhere else. The equity you built up could help cushion your retirement savings. Plus, by moving into a smaller house or less expensive area, you may be able to save on costs such as home maintenance, repairs, taxes, and utilities.

While you may feel sentimental about your home, consider whether it will be a good fit for you 10 or 20 years into your retirement. And make sure to talk with your spouse about whether you should sell or keep your home—getting on the same page in this matter is crucial!

 

RETIRING IN THE NEXT 5 YEARS? STEPS TO TAKE NOW

 
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You’re so close to retirement that you can see it on the horizon. And although you may be excited about that fast-approaching day, you also need to make sure that you are financially prepared.

We wrote this article to help people like you—people who are within five years from retirement and want to take steps to make sure you are ready. Our article provides to-dos to complete now, plus a case study to give you ideas about how to apply these to-dos to your retirement plan.

If you want to learn more about retirement planning, please download our ebook Charting Your Retirement Course. This guide covers in detail the steps you should consider taking in the decade before retirement.

GET YOUR RETIREMENT PLAN ON TRACK

In our ebook, we recommended that you initially create a retirement plan when you are 10 years out from retirement. Now that you are five years from retirement, it is time to review the plan. (And if you haven’t created a plan, now is a good time to start!)

In your review, you will want to make sure that you are on track to achieve your goals for retirement. Have you saved enough for retirement, or are you falling short? If you are short, consider what you can do to set aside more money. You may be able to adjust your budget so that you are spending less and saving more. You may want to work longer hours or even set back your retirement date.

Talking with a financial planner can be invaluable. A financial planner with expertise in retirement planning can help you understand how much you actually need for retirement. They can give you strategies that incorporate all the aspects of your finances (e.g., taxes and investments) to bring you closer to your goals. And they can help anticipate potential problems before they arise—problems that you may not even know to look for.

 

SCHEDULE A FREE CONSULTATION WITH A FINANCIAL ADVISOR

If you want to review your retirement plan or get started creating one, we offer a free consultation to see how we can help you. We are an independent, fee-only financial advisor offering service programs that can meet you throughout the stages of your life. Contact us today to see whether we would be a good fit for you.

 
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 ESTIMATE YOUR RETIREMENT HEALTHCARE COSTS

Healthcare costs are consuming an increasingly large percentage of retirees’ incomes. To avoid sticker shock, take time now to estimate what you will spend on healthcare in retirement. Factor in potential medical conditions, expected longevity, and the costs for healthcare coverage.

Remember, Medicare won’t pay for everything, such as dental work—and you will have to pay for Medicare. Although Medicare Part A is free, you will pay premiums and out-of-pocket costs for everything else. To learn more about your potential coverage and costs, check out Medicare’s official website.

When you have an estimate on how much you will spend, you can talk with your financial advisor about strategies that can prepare for and potentially mitigate those costs, such as contributing to a health savings account (HSA).

 

GET THE EBOOK

Get your complimentary download of Charting Your Retirement Course. This free retirement planning guide covers in more detail the steps you should consider taking in the decade before you retire.

 
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RETIREMENT CASE STUDY: MIKE & BETH

Mike, age 61, is five years away from his target retirement date. His wife, Beth, is 60 years old and has never worked outside the home. Mike is looking forward to retirement, but he is also worried that the money he has saved over the years won’t be enough to support himself and his wife after he stops working.

Over the years, Mike and Beth have worked with a financial advisor who has helped them implement a solid retirement plan. Now that he’s nearing retirement, Mike wants to know if there is anything more he can do to secure a solid future for himself and his wife. To do that, he and Beth sat down with their advisor to analyze where things stood. Their advisor reviewed their retirement plan and made a few small adjustments so that they could stay on track to reach their goals. He also helped them estimate their retirement healthcare costs and evaluate their long-term care options.

This last point was especially important, since Beth was likely to live longer than Mike, and he wanted to make sure that she would have the resources to pay for any care she needed after he was gone. Mike and Beth also talked about their desired retirement lifestyle, and realized that they wanted to sell their large suburban home and move to a smaller downtown condo, where they would be closer to transit and amenities.

After talking with their advisor and completing the above steps, both Mike and Beth were confident that the retirement they wanted was within reach. Over the next few years, they will continue to meet regularly with their financial advisor to make sure that they are on track to achieve their goals.

GET MORE CASE STUDIES

Our complimentary retirement planning ebook has more case studies, as well as action steps and a helpful checklist. Download your copy of Charting Your Retirement Course today to learn more about what to do 1, 5, and 10 years before retirement.

 
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SCHEDULE A COMPLIMENTARY CONSULTATION

Retirement planning can be complex, and it can be helpful to have an experienced professional providing guidance before you make decisions.

At Parkshore Wealth Management, we offer service programs that meet your needs throughout the stages of your life, including retirement. As independent, fee-only financial advisors, we can help you simplify your finances and create a better plan for the future.

Contact us today to schedule your free consultation.