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Retirementis an eagerly anticipated milestone for many.
You might be picturing leisurely days filled with hobbies, travel, and quality time.
But its a big transition to go from the structure of work life to retirement.
It can be more complex than it appears at first glance.
you should probably approach this new chapter of your life with careful planning.
Before you take the plunge into retirement, there are several key factors you oughta understand and prepare for.
Assess your sources of retirement income.
When Youll Take Social Security
Deciding when to start claiming Social Security benefits is a big decision.
Plan for when you might take social security, understanding the nuances specific to your situation, Herman said.
A meeting with the Social Security Office is advisable to understand your options.
But if you need the income sooner, it might be the right choice to take them sooner.
Medicare becomes available at age 65, but wont coverall medical expenses.
Youll need to budget for premiums, deductibles, copayments and supplemental coverage.
Consider finding a Medicare expert to walk you through the options you will have in retirement, Herman said.
Sign up for Medicare as soon as youre eligible to avoidlate enrollment penalties.
Health issues of a large magnitude can negatively upset the applecart and best-laid plans, Herman said.
Consider options to cover long-term care including hybrid and traditional long-term care policies.
Visit a qualified professional to review the options.
Having life insurance can give your loved ones financial protection.
Consider whether term or permanent life insurance is more appropriate for your situation.
Is your life insurance from work portable?
Review Your Investments
Check-in on your investment portfolio before you retire to ensure it meets your needs.
Understand the tax consequences associated with your accounts to devise a tax-efficient withdrawal strategy.
Consult with a qualified financial planner for guidance.
Dont forget to review the fees associated with your investments.
The shift to unlimited free time can be challenging.
Can you teach, volunteer, create, etc.?
Many people are living well into their 90s and finding purpose in those years is incredibly important.
Are you able to consult your old firm or others?
Make a list of activities youve always wanted to try or skills youd like to develop.
Volunteering for a cause you care about can give you both purpose and social connection.
Dont underestimate how important it is to maintain those social connections in retirement.
Some retirees choose to start small businesses based on their hobbies or expertise.
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