Retirement and Money Management Tips for Seniors

Some people start saving for retirement the minute they collect their first paycheck. Others wait for years, sometimes decades before deciding on any retirement and money management considerations. Still others manage to meet their retirement plan saving goals, but then neglect to address issues of managing that money when they retire. Making that money last as long as possible requires careful planning, but there are things that can be done to make every dollar count.

It's a known fact that people are living longer, making retirement and money management vitally important. Men are expected to live well into their 80's. Research complied by the Employee Benefit Research Institute analyzed their research and determined that nearly 10% of workers these days expected their retirement to last less than ten years, while nearly a quarter believed that their retirement would last ten to twenty years! Where is all that money going to come from?

When contemplating retirement, the first step is to try to determine how much money you'll need to maintain your current lifestyle. For many, that means maintaining about 70% to 80% of their present, working income. But you may outlive your savings if you don't save enough or don't invest wisely. Living a little too high will rapidly deplete hard earned savings, as will a medical crisis. Retirement and money management experts believe that you shouldn't take out more than 5% of your savings every year after retirement or you might run the risk of going broke.

Healthcare expenses can take a big chunk out of your retirement and money management plans, and chronic illness or an accident can put even the best-planned retirements into a tailspin. Obtaining a long-term care insurance plan can help alleviate any such unpleasant surprises. Many people don't want to invest in such insurance, but it will pay off in the long run and may prevent you from losing your life savings, your home and any other assets you have.

And while Social Security helps, most people only receive about 40% of their current paycheck amount, so take that into consideration when planning. Reduced benefits are available at the age of 62, but waiting until you're between 65 and 67 years old will get you full benefits. Bottom line, the longer you wait, the more you'll get.

Some people go back to work, at least part time, in order to supplement their Social Security and pension incomes. As a matter of fact, nearly 70% of retirees are expected to go back to work at some point during their retirement years. While most do so because they need to keep busy, many do so because they just can't make ends meet without additional income. Job sharing and easing into retirement are becoming more common every year.

Keeping informed of retirement and money management options will make your retirement much easier, but it's important to research. Determine how much of your money you want to invest in stock and bonds. Bonds are more stable, but may not provide you with the dividends to meet your needs. If possible, choose some stocks to supplement your income, but make sure you research such stocks carefully.

The advice of a reputable financial advisor can help you determine how much of your money you should invest, and where. A good way to save for retirement is in a Roth IRA. This type of savings investment is tax-deferred, so try not to touch it unless you absolutely have to.

Retirement and money management doesn't have to be painful. By starting early, you'll have a jump on planning what should be your Golden Years. Don't wait until it's too late to maintain the lifestyle you worked so hard to obtain.