Debts Can Curse Your Retired Life – The 3 Planning Strategies That Won’t Make It Happen

Most ageing people believe that financial security in retirement is something that can never happen. All it needs is commitment, rock solid planning and yes money. Studies suggest that fewer than half of the people in the US have calculated how much amount they might need for their retirement. It was seen that in the year 2010, 45% of the private industry workers didn’t participate in the defined contribution plan or the 401(k) account while the average Americans spend 20 years in retirement. With such aforementioned statistics, how can a senior be able to live his golden years by keeping debts at bay? With so less an amount in your savings account, it is not possible to feel the actual meaning of your ‘golden years’. If half of your post-retired life is spent in rushing to the debt relief companies to abolish your high interest debts, when will you get time to travel around with your spouse and your grandchildren? Have a look at the 3 strategies that you need to follow in order to make this happen.

Optimizing your Social Security benefits – Some Vital Tips:

For the Americans, the decision of when to start collecting your Social Security benefits is a very important one. Considering the fact that very few seniors have saved money for their retirement, very few have participated in their benefit pension plan, there are millions of baby boomers who are clearly depending on their Social Security investment so that they can maximize and optimize the benefits. Here’s how to approach the exercise of maximizing your Social Security benefits.

  • Be informed about the basic strategies: The longer you delay in collecting the Social Security benefits, the bigger benefit you might get in the long run. Married couples might tag-team where one spouse will claim “spousal” benefits to delay his own benefits until it reaches its maximum and then switch over. The single baby boomers who can delay the benefits till the age of 70 can maximize their checks and this might act as a protection even when you don’t have an insurance policy.
  • Look for expert advice: There are Certified Financial Advisors who can offer to do the calculations for you. Check out such services to know the one that you prefer. Not all will cover cases like divorce and so you can get full reports for no cost.
  • Life expectancy does matter: The finest strategy for a couple might change based on how long they live. A 59 year old wife and a 61 year old husband might easily coordinate their benefits with her starting to claim at 64 and the husband claiming the benefits until he turns 70 and then taking the maximum of the benefit.

Saving for your Retirement with Variable Annuities:

Variable Annuities are an extremely popular retirement investment vehicle that is claiming its benefits even in the bear market. Despite their beating, the variable annuities still remain a viable alternative for retirement planning. Here are some situations when you should consider variable annuities.

  • When you want to make a long term financial assurance for retirement and you’re confident that you won’t withdraw the funds before you reach your retirement age.
  • When you may be able to take full advantage of the tax-deferred investment growth and this can be especially appropriate when you enter a high marginal tax bracket and you’re at least 6-7 years from retiring.
  • When you already have fully-funded retirement plans like IRAs and 401(k) s where you’re already saving money.
  • When you wish to safeguard your savings amount from the prospective lawsuits and make it less reachable to the court.
  • When you feel that you can make your retirement investments on your own and on the other hand you also have a Certified Financial Advisor on whom you can rely while making investments.

Life Insurance strategies to follow for enhancing your Retirement Planning moves:

The baby boomers and the seniors should think strategically about their present and future life insurance needs and this is a core important part of retirement life. Here’s what you should do when you’re approaching your retirement to maximize your Life Insurance benefits.

  • Let the term insurance policies to expire: Most of the term life insurance policies are taken out for the dependent kids and these usually expire when the kids are gone. You might be tempted to replace that with something else but you shouldn’t succumb to this temptation as you should save this money.
  • Allow the cash to multiply tax-deferred: If you’ve already got whole life insurance policy, it is most likely that you’ve probably built significant cash value within the policy. One of the benefits that you might already be reaping is that the cash value multiplies tax free. You should let it grow and only surrender the life insurance policy when you’re in dire need of income that is tax-free.
  • Use dividends to pay the life insurance premiums: If you already have an old whole life insurance policy to keep on receiving tax-deferred growth, you may require considering using the policy dividends to repay the premiums of the life insurance policies as this will help you save your dollars.

So, if you’re a baby boomer or a retiree, follow the above mentioned strategies to enhance your retirement benefits. Ensure saving aggressively so as to keep debts at bay and avoid letting debts mar your retirement financial growth.

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