Retirement is something that many of us look forward to. Even though you may be mentally and physically to retire, your wallet may not be ready for you to. You have to make sure that the nest egg that you have built will sustain you.
What Are Your Goals?
Most financial experts recommend that you aim to live on at least 80 percent of your income. However, this is a figure that is given to the average person. There are several factors that have to be taken into consideration. If you plan on moving to an area with higher costs, then you may need to have need to have more money. You may also need more money if you plan on traveling or pursuing a hobby.
When Will I Draw Social Security?
You can start drawing Social Social Security at the age of 62. However, you will not be able to get the full benefits. In fact, you may cut your benefits by 30 percent if you file at the age of 62. You can get full benefits at the age of 67.
However, if you wait until the age of 70, then you will be able to increase your Social Security benefits by 8 percent. You will need to explore your Social Security options before you retire.
What Will Be My Long-Term Care and Health Care Costs?
According to Fidelity, a couple who retires at the age of 65 will spend a total of $275,000 on their health care costs. Keep in mind that this figure does not include the cost of long-term care. You will need to keep this figure in mind when you are planning for your retirement.
Your overall health will also affect how much you will spend on health care and long-term care. If you are in good health, then you will likely spend a lot less on your health care. However, if you have serious health conditions, then you may have to spend thousands of dollars per year on health care.
Additionally, you will need to consider the cost of long-term care. It is estimated that 70 percent of people will need long-term care at some point in their life. Home care, nursing home care and assisted living are examples of long-term care that you may need to have at some point. You may want to invest in long-term care insurance before you retire.