Amplify Financial : Your 60's

Your 60's

A Time of Change and Opportunity

You’re in your 60’s and have reached or are nearing retirement. Or perhaps your considering semi-retirement and plan to keep working part- or full-time. It’s time to assess where you are and how close you are to making your dreams a reality. Identifying and accounting for the various sources of retirement income, as well as planning your estate, can be overwhelming. Our financial planner, Dan Dillard, has identified a few of the key issues you may be facing, and can help you find the right balance between planning for your future needs and enjoying your retirement.

Nearing Retirement

The transition into retirement is when you are changing from your full-time working years to your retirement years. If retirement is approaching, you may have to make numerous decisions. Can you afford to retire? What about early retirement—is it a possibility? If you want to continue working, are there other considerations? Your first step is to review your sources of retirement income and estimate your retirement needs. The closer you are to retirement, the more accurate a picture you should be able to get. Even more, you should consider the timing of your retirement.

Determining your retirement income needs when retirement is still in the future is not an exact science. The further away retirement is, the harder it will be for you to get an accurate picture. The sooner you start thinking about it, however, the greater the opportunity you have to achieve the retirement lifestyle you want.

Planning an Estate

Simply stated, estate planning is a method for determining how to distribute your property during your life and at your death. It is the process of developing and implementing a master plan that facilitates the distribution of your property after your death and according to your goals and objectives.

At your death, you leave behind the people that you love and all your worldly goods. Without advance planning, you have no say about who gets what, and more of your property may go to others, like the federal government, instead of your loved ones. If you care about (1) how and to whom your property is distributed, and (2) ensuring that your property is preserved for your loved ones, you need to know more about estate planning.

As a process, estate planning requires a little effort on your part. You’ll want to contact a certified financial planner, and an estate planning attorney to make certain that your estate is maintained and protected.

Planning for Business Succession

One of the important decisions a business owner must face is when and how to step out of the business—in other words, business succession planning. Do you expect to retire from your business? Do you have a plan in place? What would happen to your business if you were to die today? Do you have children you hope to bring into the business? These are questions only you can answer, and your answers will lead you and your financial and legal advisors to a course of action. When you develop a succession plan for your business you have two basic choices: you can sell your business, or you can give it away. Once you choose to either sell or gift your business, you can structure your plan to go into effect during your lifetime or at your death.

Financial Windfalls

What would you do with an extra $10,000? Maybe you’d pay off some debt, get rid of some college loans, or take a much-needed vacation. What if you suddenly had an extra million or 10 million or more? Whether you picked the right six numbers in your state’s lottery or your dear Aunt Sally left you her condo in Boca Raton, you have some issues to deal with. You’ll need to evaluate your new financial position and consider how your sudden wealth will affect your financial goals.

Starting a Business

Before you start your own business or buy an existing business, you should do some initial planning. You may have already decided what type of business you want—your own restaurant, retail outlet, service, or manufacturing plant. You need to choose a suitable location—can you work from home, or do you need a separate facility? You should assess your financial requirements, schedule daily activities, and plan for contingencies, which may be included in your business plan. Planning your business usually requires the help of any number of professionals—an attorney or accountant, for example. The success or failure of your business may depend upon your initial planning, but how do you plan and what do you plan for?

Social Security Benefits

Your retirement benefit is based on your average earnings over your working career. Higher lifetime earnings result in higher benefits, so if you have some years of no earnings or low earnings, your benefit amount may be lower than if you had worked steadily. Your age at the time you start receiving benefits also affects your benefit amount. Although you can retire early at age 62, the longer you wait to retire (up to age 70), the higher your retirement benefit.

You can check your earnings record and get an estimate of your future Social Security benefits by filling out a request at your local Social Security office or by visiting the Social Security Administration (SSA) website. You can also find this information on your Social Security Statement, which the SSA mails annually to every worker over age 25. You will receive this statement about three months before your birthday. Review it carefully to make sure your paid earnings were accurately reported—mistakes are common. Call the SSA at (800) 772-1213 for more information.

Medicare/Medicaid

If you are 65 or older when you retire, your worries may lessen when it comes to paying for health care—you are most likely eligible for certain health benefits from Medicare, a federal health insurance program, upon your 65th birthday. But if you retire before age 65, you’ll need some way to pay for your health care until Medicare kicks in. Generous employers may offer extensive health insurance coverage to their retiring employees, but this is the exception rather than the rule. If your employer doesn’t extend health benefits to you, you may need to buy a private health insurance policy (which will be costly) or extend your employer-sponsored coverage through COBRA.
But remember, Medicare won’t pay for long-term care if you ever need it. You’ll need to pay for that out of pocket or rely on benefits from long-term care insurance (LTCI) or, if your assets and/or income are low enough to allow you to qualify, Medicaid.

Whether you need to manage transitions, learn about your savings and cash management or identify and plan your retirement and investment options Dan wants to help. He offers a complementary 30-minute consultation to help you identify the financial strategy that’s best for you. Please contact Linda Koop at 512-519-5476 or use our contact form to set up an appointment.