4 Goals to Meet When Crossing the Retirement Finish Line

retirement planning

You have so much to celebrate and look forward to as you near and enter retirement: Retirement means the end of a long career, but the beginning of something new, and the “what” is up to you. The way you finish the race can impact the rest of your retirement, whether you’re approaching retirement or have recently retired. Meeting your goals when crossing the retirement finish line means having a comprehensive plan in place that covers these four key areas of retirement planning.

Meeting Savings Goals

Saving enough for retirement can be difficult while sending your children to college, paying off a mortgage, and dealing with the possibility of retiring during a crisis. The good news is that starting at age 50, you can contribute more to your 401(K), IRA, or other retirement savings account. In 2020, workers 50 and over can contribute $26,000 per year to a 401(k), 403(b), 457, or Thrift Savings Plan.[1] The IRA 2020 contribution limit is $7,000 for workers 50 and older.

A Plan for Minimizing Taxes

Taxes can often be our largest expense – even in retirement, especially if you’ve saved a significant amount in a taxable retirement account like a traditional 401(k) or IRA. You can work to reduce the tax burden on your retirement income and on what you will eventually pass down to loved ones. Strategies like Roth conversions, minimizing taxes on home and property sales, and taking advantage of tax credits and the increased standard deduction for Americans 65 and older are options we can explore with you.

A Retirement Income Strategy

One source of reliable retirement income is Social Security, which is why it’s so important to maximize your benefit. But, only 4% of retirees claim benefits at the optimal time, losing out on an average of $111,000 per household, according to a recent study[2]. Beyond Social Security, you may consider turning some of your savings into lifetime retirement income. If you don’t have a pension or if you took a pension buyout, you might consider using one of the many annuity options available to help protect against outliving your money while potentially earning interest on your principal.

A Long-Term Care Plan

According to government estimates, someone turning 65 today has an almost 70% chance of needing long-term care later in life.[3] When you consider that the median annual cost for a private room in a nursing home is over $102,000,[4] covering long-term care costs is a major feat. Medicare and Medicaid typically don’t cover costs, and paying with funds from a traditional 401(k) or IRA can trigger a larger tax burden. However, there are several other options for covering long-term care costs, and a solution can be tailored to the individual’s needs.

We’re here to help you finish strong in the retirement marathon by answering your questions, providing solutions, and handling the more complicated aspects of retirement planning. We respect how hard you’ve worked to get this far, and want to help you plan for the next phase of life. We offer complimentary reviews so that you can learn more about our services and approach to retirement planning.

[1] https://www.irs.gov/newsroom/401k-contribution-limit-increases-to-19500-for-2020-catch-up-limit-rises-to-6500

[2] https://unitedincome.capitalone.com/library/the-retirement-solution-hiding-in-plain-sight/

[3] https://longtermcare.acl.gov/the-basics/how-much-care-will-you-need.html

[4] https://www.morningstar.com/articles/957487/must-know-statistics-about-long-term-care-2019-edition

The commentary on this blog reflects the personal opinions, viewpoints and analyses of BML Wealth Management’s employees providing such comments, and should not be regarded as a description of advisory services provided by Cooper Financial Group. The views reflected in the commentary are subject to change at any time without notice. Nothing on this blog constitutes investment advice. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Investing involves risk, including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. Past performance is no guarantee of future returns.

Investment Advisory services are offered through Cooper Financial Group, an SEC Registered Investment Advisory firm. All Insurance Services are offered through BML Wealth & Insurance Services. California Insurance License #0M15550. BML Wealth Management & Cooper Financial Group are not affiliated.

We do not provide tax or legal advice, all individuals are encouraged to seek guidance from qualified professionals regarding their personal situation. Any references to protection benefits or steady and reliable income streams in this guide refer only to fixed insurance products. They do not refer, in any way, to securities or investment advisory products. Annuity guarantees are backed by the financial strength and claims-paying ability of the issuing insurance company. Annuities are insurance products that may be subject to fees, surrender charges and holding periods which vary by insurance company. Annuities are not FDIC insured. Indices mentioned are unmanaged and cannot be invested into directly.

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