If you are determined to ensure you have enough income or savings when it comes time to retire, then the thought of starting your retirement planning might be stressful. Many clients are concerned about whether they have waited too late to start saving and whether they have chosen the best strategy for doing so. While these are typical concerns to have, retirement planning should not be discouraging. With the help of your Kansas estate planning attorney, you can avoid the most common mistakes people make in creating their retirement plan.
Make sure your retirement goals are reasonable
In reality, the majority of clients have no idea exactly how much money they should have put away in order to retire comfortably. In fact, few people know how to come up with a reasonable estimate. Certainly, it can be challenging to determine how much it will take to continue to sustain your current lifestyle 30 years from now. Therefore, clients might think they need more savings than they actually do, or they might underestimate that number. Either way, it can be a big mistake in retirement planning because your goals would be nearly impossible to reach.
Be sure to include future increases in the cost of health care
One thing that is important not to forget is the likelihood that the cost of health care will increase over the years. So, when you make your retirement plan, you must consider this potential for increase. This is true even if you are relatively healthy now because, as you age, you are more likely to need health care. But, if you neglect to account for this in your retirement planning, you may be faced with financial issues when that time comes. Another big mistake is to assume that Medicare or Medicaid will be sufficient to cover your medical expenses once you retire. The best thing to do is remain proactive and plan ahead.
Do not overlook the possible need for long-term care
Besides basic health care costs, some seniors will require long-term care during their retirement years. According to some information, nearly 70% of individuals who retire require some type of long-term health care. These medical expenses have the potential to exhaust all of your savings if you don’t plan for them ahead of time. For that reason, you need to think about the possibility that you will need long-term medical care and then include those estimated expenses in your retirement plan.
Be sure to accumulate sufficient savings for your retirement years
It should go without saying that the sooner you start saving for retirement the more you will be able to save. Therefore, you must start your retirement planning now if you have not done so already. If not, regardless of how good a plan you may put in place, you may not have sufficient funds to enjoy your retirement in comfort. The sooner you can begin making consistent deposits into a savings account, the more compound interest you can accrue.
Don’t forget to update your retirement plan periodically and as necessary
It is very vital to having a successful plan to periodically review your retirement plan so you can make necessary changes. If there have been changes in the market that might affect your investments, you may need to make adjustments to your retirement plan with regard to those investments. Also, if there has been an adjustment in your income or cost of living that could also affect your overall plan. If you have a new baby or grandchild, or if there has been a divorce or death in the family, those changes in your life situation would likely necessitate modifications to your retirement plan.
Retirement options available in Kansas
The attorneys at Gaughan & Connealy are prepared to review your retirement plan with you, or help you to create a new plan in its entirety, while explaining the advantages and disadvantages of all options available to you.
One significant part of retirement planning also includes deciding on the beneficiaries of your estate while considering the potential tax consequences. Retirement planning and estate planning work best when they are completed at the same time.
Join us for a FREE workshop! If you have questions regarding retirement planning, or any other estate planning matters, contact Gaughan & Connealy for a consultation either online or by calling us at (913) 262-2000.