If your retirement is just around the corner, you should ask yourself these three questions so that you can be better prepared financially for the next (and perhaps the best) stage of your life.
When do you plan to retire?Do you plan on working in your 60s, 70s, or beyond? Or are you planning on taking an early retirement? Naturally, if you delay retirement, you'll have more income generating years, as well as fewer years of having to withdraw money from your retirement accounts. On the flipside, an early retirement means making sure you have enough money so that you can enjoy doing the things you like and have planned for.
Do you have enough money to last you another 20 or 30 plus years?Longer life expectancies could mean a retirement that lasts two or even three decades. This means you may need to save much more than your parents ever did. If you have concerns about not having enough money saved, you may want to review your retirement savings plan to see where you can bolster your savings while you're still working. If you're not sure how, consult with a qualified financial professional who may be able to help get you on track.
What's your Social Security strategy?
For 75 years, Social Security benefits have been the rock that Americans have relied on to supplement their income in retirement. In fact, Social Security replaces nearly 40 percent of an average wage earner's income during retirement. But because Social Security doesn't replace all of your income, you need to make sure you maximize your benefits. To do this, however, you need to be strategic about when you apply.
For example, if you take your benefits early at age 62, you'll receive a reduced benefit but will receive payouts for a longer period of time. In contrast, waiting to take your benefits until you reach your full retirement age means a bigger payout, but for fewer years. To get a sense of the best option for you, consult with a qualified financial professional. If you want to get an estimate of what your benefits may be by either taking them early or waiting, visit the SSA's website.