So now I am immediately faced with a new dilemma, as this is the year of my 65th birthday. Yes, that is right. I now need to choose a decent Medicare supplement. As we have just been talking about the cost of retirement, it is fresh in my mind that financial planners state that the biggest portion of their dire predictions about our income needs is based on the continually rising cost of healthcare. It therefore makes sense to me that my health coverage should be as good as available, within a cost that makes sense. I am also leaning toward choosing Blue Cross, just because my providers are happiest with their coverage and tell me that they are processing claims much more quickly than in the past. The website I found most helpful was at medicare.gov. It explains medicare insurance and helps you decide on a plan. Any other thoughts out there. Please comment…we are all ears.
In all honesty, I must start with a disclaimer. I am heading into quicksand in approaching this topic as I have no background in finances other than my own. That said, I have to say that my assets are growing at a good rate thanks to strategies I have adopted, and I am sure there are lots of you out there with equally good plans, who might wish to share them in the interest of helping your peers. I “retired” at 59, with far less in assets than is recommended. It was obvious that, though I could begin drawing retirement from my company, I could not afford to dip into my assets. So it was clear in the beginning that I would still need to have a new source of income. In my case I was able to work under contract with my previous employer, doing a part-time job that I knew I would enjoy. It is obviously safest to have employment lined up prior to giving up your career, and quite a number of people are actually able to line something up through their current employer. Otherwise, there are plenty of on-line employment services, such as monster.com, available at your fingertips. A quick search will also give you lots of options for preparing a fresh resume.
Another of my strategies was to take advantage of Roth IRAs. Until close to retirement I hadn’t given this much thought, as my savings all headed to my 401K. Because I was also somewhat interested in taking more advantage of the stock market, I went to E-trade, on-line, and for just the cost of my trades ($9.99 per) I was able to initiate a Roth IRA and use E-trade’s extensive assistance, in the form of articles, ratings and information about the stocks, to start a small portfolio, which has done well and grows tax free. This continues to be a source of enjoyment, as I research, buy and sell and watch that little nest egg grow.
The last piece of my success was through advice from the financial planner available to me through my 401K. He recommended putting my funds into an “income lock” contract, whereby my base amount is guaranteed to not lose ground. It’s value is assessed on the anniversary of the day I initiated it. If my funds do poorly, my base amount remains the same until the market recovers. This plan allows my savings to be invested in areas of higher risk and has resulted in some good returns.
The bottom line is: Take part in your investments. Understand them and seek out all information available through financial advisors you know and trust, as well as trusted investment sites on-line.
You are probably here because you have been planning for (dreaming of?) the day when you can walk away and start something new. This plan is very different for everyone.
Things to consider are:
1) Do I love going to work most days? If the answer to this is “Yes, my work is rewarding and my co-workers are an extremely important part of my life”, then you may as well continue on until at least part of that statement is no longer true. You will know when you are ready, because other interests will begin to pull at you more strongly, and you will find less gratification in what you are doing.
2) Do I need a lot of money to pursue my retirement interests? If the answer to this is “Yes”, than you will need to take a serious look at your savings and check your numbers against some of the many retirement calculators to be found on-line. In most cases you will find that you will probably be working until death. There are, however, numerous websites waiting to give you advice on maximizing your savings. Search for “retirement planning” and you will have all the advice you care to read. The social security site will help calculate your income from that resource. If you have a broker, their website will offer a wealth of info, as well.
3) Is my desire to retire, strong enough that I am willing to live more frugally to make it happen? Now we are talking my language. If I had followed available wisdom, I would have missed out on the first 6 years of my retirement. My next posting related to finances will discuss money management in early retirement.
I am so happy you have arrived here to join with me in exploring the abundant opportunities that the internet provides retirees. Whether you are just beginning to consider retirement, or have years of experience as a retiree which you are eager to share, I hope you return many times. Check out the ideas presented, and respond with your own comments and new ideas. Categories will cover issues related to finances, travel, health, relationships, and entertainment, and together we will investigate the ways both new and old technology can impact and enhance our lives in each area.