How to Make Your Retirement Savings last Longer
How’s your retirement nest egg looking these days? Whatever your situation: already living off your retirement savings, still a few years away, or you’re just getting started on that nest egg, planning and saving for retirement is very important.
But once you have that nest egg saved up, you need to know how to manage it; retirement can be full of surprises. Running out of money in retirement is a harsh reality faced by too many retirees. Many think they have enough saved up, only to find out they don’t due to unexpected healthcare costs, bad investments and/or cost of living increases that can affect how long your retirement savings last. So, here are some suggestions to help your retirement money last longer.
Keep Fixed Expenses Low
We all have fixed expenses like our house payment, grocery bills, utilities, etc. One of the best ways to make your money go further in retirement is to minimize these expenses as much as possible. Choosing the right size living quarters is one of the best ways to lower your fixed expenses.
Take Full Advantage of Social Security Benefits
While it would be nice to start collecting Social Security checks as soon as you turn 62-years-old, the truth is, the longer you wait the better, in most cases. By taking these benefits too early, you get less money both now and down the road. And that’s important because you might need more money later than you need it right now. Generally, the longer you expect to live, the longer you should wait to collect SS.
Set Up a Spending Plan
Now that you’ve retired you can throw caution to the wind when it comes to spending, right? WRONG! Making and sticking to a budget is vital if you want your retirement savings to last as long as you do. You need to make a spending plan that fits your overall financial situation and stick to it! If you want or need to spend more, then you need to save more.
Inflation Is Real
Never forget the “I” word. Inflation is real and you will likely face it, as you get older. The cost of living usually doesn’t go down. So make sure you factor inflation into the equation when saving for retirement.
Plan for Taxes
Many retirees overlook tax planning, they just don’t realize all the taxes they still have to pay when they quit working. Make sure you know the tax laws and rules so you can be prepared for them.
Make Your Plan
These are just a few suggestions to help you better prepare for retirement. The key to having enough savings for retirement, is to start implementing these recommendations now. If your tax or financial situation is complicated and you need additional help, we strongly suggest contacting your current tax professional.
If however, you’re in the market for a new, trusted tax and family office advisor, we never sell investments, please consider contacting us here at Info@GROCO.com. Unfortunately, we no longer give advice to other tax professionals.