Five things you can do to be ready for retirement
Your finances will change when you retire, and for most of us that means living on less. Making sure you have a firm understanding of your financial picture in retirement will free you up to truly enjoy this next phase of life.
Add up your assets
Make a list of all your debts, liabilities, savings account, income stream and insurance policy you have. This information will allow you to accurately assess your current financial situation. It’s a good idea to put this into a spreadsheet for easy updating.
Determine healthcare/understand Medicare
Healthcare is a significant portion of a retiree’s budget. It is important to know where you’ll be getting your health insurance and what it will cost. Take some time to understand Medicare and what it doesn’t cover so you can budget for items you’ll need to cover out of pocket. Please note that DRS does not provide health insurance information. To learn more about health insurance for public employees, please visit PEBB.
Adjust your investing strategy
Your risk tolerance may change once you’ve retired. A financial advisor can help make sure your investments are designed to work for you in retirement.
Decide when to claim social security
You don’t have to claim Social Security right away, and the longer you wait, the greater your earnings will be. The social security website explains that if you delay getting Social Security until age 70, you’ll get a 8% simple interest increase for each year after your full retirement age of 67. That equals 124 percent of the monthly benefit you would get at age 67.
Pay off debt
Since your retirement income is likely to decrease, paying off those fixed payments like credit cards frees up money for living expenses.
Recent news
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When it comes to your retirement plan, have you seen these acronyms?
The Office of the State Actuary prepared this example to assist DRS with developing a general educational resource.
