A Happy Retirement Takes Planning

“Forget finances, you’ll never be ready to retire, unless you’ve thought through exactly what you want your next chapter to be like.”

In the past, people usually retired when they reached 65. They stayed near their family homes and died after just a couple of years. We now see retirement very differently.

Some folks are now working well into their 70s or even 80s at their current job or at a new position. Some seniors continue to work full time, and others work part-time, with time for vacation trips and leisure activities in their routine. Some people remark that they’re busier now, than when they worked full time.

Kiplinger’s recent article, entitled “The Emotional Side of Retirement Planning,” explains that the majority of people who are happily retired, spent a lot of time thinking and planning for it.

People in their 60s should be thinking about retirement. While most have started to make plans, others have trouble formulating a strategy. Nevertheless, everyone wants to know whether they can afford to retire. The answer is usually “that depends.” It depends on the answers to some questions like the following:

•What do you see yourself doing your first week of retirement and how does that feel?

•If you’re married, how does your spouse feel about retiring?

•Do you think you’ll stay in your home or downsize?

•Do you want to live in warm weather or a cooler climate?

•How’s your health?

•Do you want to leave a legacy for your family or spend your money now?

Figure out what your retirement looks like. Before you consider whether you can afford to retire, check where you are both psychologically and emotionally. If you’re not ready mentally, then boatloads of money won’t make you 100% happy in retirement. It’s not unusual for people these days to spend 15-20 years in retirement.

The Stages of Retirement:

Many people first think of retirement like it’s a long vacation. Some return to school and take fun courses, change professions or find new hobbies and interests. Many new retirees do more traveling or get involved with church or charities. But after the novelty of retirement declines, many people gravitate to a slower and more settled lifestyle.
Physical health may start to decline, and at some point, many aren’t able to live on their own and require assistance. Some try to stay in their homes with help, some go to assisted-living facilities and others enter nursing homes. Everyone has a distinct set of circumstances, and decisions must be made on an individual basis. Available finances impact how, when and where someone retires. With more resources, there will be more options. However, every potential retiree needs to have a well-thought-out plan in place that makes sense for them financially and emotionally. Speak with an elder law attorney about creating your game plan.

Reference: Kiplinger (May 2017) “The Emotional Side of Retirement Planning”

Do You Need Long-Term Care Insurance?

How to pay for future nursing home care concerns many Americans as they get older. Many consider purchasing long-term care insurance, but it might not be the best option for everyone.

The costs of staying in a nursing home are already very expensive and they are expected to rise. Individual Americans have to figure out a way to afford a nursing home, if it is ever needed.

While it is true that Medicaid will pay for nursing home care, the government will not pay if you have plenty of your own assets. That means if you were planning on leaving a sizable estate to your children, you will likely be unable to do so, if Medicaid pays for your nursing home care.

Another option to consider, is to purchase long-term care insurance.

Recently, the Wills, Trusts & Estates Prof Blog discussed it in “Should You Buy Long-Term Care Insurance?”
One of the key questions to consider, is when you might need the insurance coverage. If you are unlikely to need nursing home care for a long time, then it is often a better idea to save enough money so you can self-insure against the possibility of needing long-term care.

On the other hand, some long-term care policies have waiting periods that need to be considered. If you are likely to require nursing home care before the end of the waiting period, then an insurance policy will not help you.

One thing is certain. Long-term care insurance policies are complex.

You should seek the advice of an elder law attorney before signing a policy.

Reference: Wills, Trusts & Estates Prof Blog (Feb. 16, 2017) “Should You Buy Long-Term Care Insurance?”