Most of us can’t wait to retire, and probably would have done it years ago if we could have! But now that you’ve reached your fifties or sixties, the countdown is on. You know you’re getting close, and you’re ready to set a target date to stop working.
Once you can say “yes” to these three goalposts, you’re probably getting close to retirement.
You’ve reached full retirement age for Social Security. Yes, sometimes people need to retire early, for various reasons. In most cases, it’s better to wait until you reach full retirement age, according to Social Security. Depending upon when you were born, that’s age 66 or 67. Once you reach this age, you will receive your full scheduled monthly benefits based upon your work record.
You’ve planned for healthcare. Healthcare usually becomes more expensive after age 60 or so, because most of us develop a health condition or two that will need to be managed. But regardless of your current level of health, everyone needs a plan to pay for eventual needs.
You will reach Medicare eligibility at 65, but keep in mind that Medicare doesn’t pay for everything you will need. You will still owe copayments and deductibles, and you should plan on paying Part B premiums or premiums on a Medicare Advantage plan. You might also consider a Part D plan to pay for prescriptions or a dental and vision care plan. In addition, don’t forget about the cost of long-term nursing care; Medicare won’t pay for that, so you need to consider your options carefully.
You’ve reached your savings goal. How much income do you need to generate each year, in addition to your Social Security benefits? And will you be able to access that income through regular withdrawals from your retirement account? Do you have any other source of income?
The amount of savings you will need depends upon your cost of living, so it will vary from one person to the next. Let’s schedule an appointment to discuss your target savings goal, along with other considerations regarding retirement planning. Then together we will decide whether you will be ready to retire soon.