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Youve spent yearssavingand preparing financially for this moment.
But how do you know when youre actually ready?
One way is to review common retirement risks.
They generally advise transferring money out of the stock market and into more stable assets, like government bonds.
You dont want to get caught in a downward trend just when youre trying to retire.
But talk to a financial advisor to figure out the right percentage.
Once you quit working, you may realize that the retirement life you envisioned isnt the one you want.
For example, maybe you planned for a quiet retirement in the country but actually want to travel more.
Or you might discover anew passion projectthat requires some financial backing.
The best way to prepare for this risk is to leave yourself some cushion in your financial plan.
If you save a little more than you think you need, youll have more flexibility once you retire.
Will that continue after you retire?
Even if youre not planning on it, the requests could come.
Thats why its smart to talk about this issue with anyone who may expectfuture financial support.
You may be able to provide that support with a little planning.
Unforeseen Health Issues
Next, remember that health costs rise exponentially with age.
You may face issues soon after retiring that drain your budget faster than expected.
In the long run, this can lead to you running out of retirement funds before youre ready.
The best way to prepare is withgreat health insurance.
That could mean supplementing base Medicare with private coverage.
You could also contribute to a health savings account (HSA).
Of course, you cant plan for everything.
Not Leaving Yourself Enough Financial Wiggle Room
Financial planning for retirement can be difficult for many reasons.
But one key challenge is that you dont know exactly how costs will evolve over the coming decades.
The solution is to save a little more than you need for retirement.
This will make you more prepared to deal with unexpected costs some of which youre almost certain to experience.
Doing so supplements your savings throughout retirement to help you become more resilient in changing economic conditions.
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