Good Financial Reads: Retirement Planning

FIRE stands for Financial Independence, Retire Early.  The idea is to get yourself to a point where you don’t have to work anymore at a younger age the traditional retiree. There is a wide spectrum, with a lot of the FIRE community relying on extreme frugality to supersize their savings to achieve FIRE.  

Others gun for something called FatFIRE. Think successful startup exits at a young age with millions in the bank.

Did you know the maximum amount that can be contributed to retirement accounts can change from year to year?  It’s true.  So do you update your monthly contributions to your retirement accounts?  Taking advantage of these contribution limit increases can make a big impact over your working career.  Today, I want to walk through this with you to make sure you are indeed maxing out these accounts when able!

Many people think their health care in retirement will be free or close to it because of Medicare. Here is some bad news for you: Medicare is subsidized, but not free.  According to estimates by Fidelity, a single retiree can be expected to pay between $140,000 (men) and $150,000 (women) in health-care related expenses throughout their retirement, starting at age 65. For a couple, the expense is twice as much, close to $300,000. The sooner you learn the basics about Medicare and its likely costs, the more you’ll be able to plan and cover these costs.

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Pension Option analysis decisions can be difficult to evaluate alone.  Although we are beginning to see them less pensions are still a critical source of retirement planning for many people.  Making the right decision with your pension can save you and your family thousands of dollars over time.  Today we discuss things you should consider as you evaluate which option would be best to take your pension.  When you consider these you will be able to stick with your plan for the long-term.

One of the hardest questions for people approaching retirement is to figure out how much annual income their retirement savings can generate. That’s the $64,000 question for retirees because they equate income to the living standard they are accustomed to. A careful answer should consider the overall financial picture, retirement horizon, retirement goals, preferences, and each household’s ability to adjust to setbacks. 

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