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Financial Tips for Newly Retired Seniors

January 17, 2022

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Congratulations! Now that you’re finally retired, you’re able to start turning your retirement plans into reality. For many retirees, that means spending more time with family. Or taking a vacation more than once a year. What are the top travel destinations on your bucket list?

Closer to home, are there opportunities you want to pursue? Learning new things can help keep your mind sharp. Volunteering can give you a sense of purpose and connect you to your community. Investing in your health is also important, so be sure to include regular exercise as part of your retirement lifestyle. 

Of course, funding your new lifestyle is what you’ve been working for most of your life. If you’re wondering if your retirement nest egg will be enough to last you through retirement, you’re not alone. But there are steps you can take to stretch your retirement budget and have the retirement you’ve always wanted. 

Retirement Planning Tips for a Secure Financial Future

Don’t let your retirement get bogged down by financial stress. Here are some quick financial tips for retirement to ensure a secure future.

1. Consult a trusted financial planner.

Sorting through all the tax implications and rules of retirement can be complicated. A trusted tax consultant can help you understand the fine print of retirement — helping you lower your tax bill, while also ensuring you don’t get penalized for things like failing to take the required minimum distributions from an IRA or other investment accounts. Additionally, a financial advisor who specializes in helping retirees can help you develop a plan to turn the wealth you’ve built during your working years into an income that will last for the rest of your life.

2. Look for ways to minimize and eliminate debt as soon as possible.

Credit card debt, mortgage payments and personal loans reduce the amount of money you have to spend each month on priorities like health care, travel and leisure activities. This could mean having to make significant lifestyle changes or running out of money. Consider ways to minimize and eliminate “bad” debt such as high-interest credit card debt, equity lines of credit and car loans. Maintaining “good” debt such as a mortgage is OK as long as your home is appreciating in value.

3. Find areas to downsize and reduce expenses.

Many seniors no longer want to be bothered by the maintenance of a large home or are looking to reduce or eliminate mortgage payments. Downsizing to a smaller, more manageable residence can make life easier while freeing up some of the equity in the home you sell. In addition to downsizing or eliminating your mortgage, retirement is also a good time to evaluate other recurring costs for things like monthly subscriptions, memberships, or services you no longer need or want.

4. Consolidate bank accounts and investment funds.

It’s easier to manage your investment portfolio when your retirement savings and investments are all in one place. Consider moving all investment accounts to one financial institution. This can help reduce fees and expenses while allowing you to monitor your accounts at a glance. For similar reasons, you may also want to consolidate all checking and savings accounts in one bank. Traditional brick and mortar bank rates, however, may not offer the best interest rates.

5. Factor inflation into your budget.

Many retirees start retirement by setting a monthly budget. But many fail to factor inflation into that budget and, over time, realize that the initial budget they set doesn’t go as far as it used to. While inflation varies year over year, many financial advisors recommended assuming a 3% increase.

6. Stay financially healthy with an annual checkup.

Financial planning is often top of mind for new retirees, but it’s important to regularly assess your financial health. Taking time even once a year to re-evaluate your retirement plan can help you avoid financial issues down the line.

Plan for the Future at Franciscan Ministries

As you enter retirement, moving to a senior living community probably isn’t in your immediate plans. But it’s never too soon to start researching your options. Many older adults who move to a senior living community say they wish they’d moved sooner. To learn how Franciscan Ministries can support an active, independent lifestyle — and provide a plan for life’s what-ifs — get in touch. We’re always happy to answer any senior living questions you may have.