Don’t Forget to Include These Things in Your Retirement Plan!

6:42 pm Retirement Planning

retirement sign e1367526898975 Don’t Forget to Include These Things in Your Retirement Plan!Hopefully you have met with your estate planning attorney to plot out a comprehensive retirement plan; if not, here are some things you need to plan for:

Health insurance – Even if Medicare will be covering most of your health care costs, you will still need to pay Medicare Part B premiums, which can range from $110 to $350 per month.

Deductibles and co-pays – Retirees often choose a higher co-pay rate or deductible to keep their costs down.  However, you should assess your health care needs carefully before electing this route or you could end up paying more out-of-pocket than you planned.

Prescription drugs – Navigating all the choices for Medicare Part D prescription drug plans can be an overwhelming task for many retirees.  Some national pharmacy chains are now providing free Medicare reports based on prescription history that can help you decide.

Long-term care – Since Medicare Part A only covers the first 20 days of care, long-term care patients are responsible for paying a sizable portion for the next 80 days and then everything after that.

Lifestyle – If you plan to travel more, you need to plan for those costs.  Retirement also means more hours to fill with leisure pursuits, so if there is a cost attached to that – golf course fees, club memberships, etc. – it should be part of the plan.

Gifts – Being blessed with children and grandchildren means you will likely enjoy your retirement more – but it also means you will need to plan for the cost of gift giving on holidays and birthdays.  Of course, many seniors find ways to give more of their time and spend less money by making celebrations about shared experiences instead of expensive gifts.

Household help – Include costs for any household help – house cleaning, yard work, maintenance – that you may not be able to do yourself.

Taxes – The IRS requires retirees to pay income tax on traditional IRA and 401(k) distributions.  After age 70 ½, you must also take the required minimum distributions or face being hit with a 50 percent tax penalty on the amount that should have been withdrawn.

To ensure you have a comprehensive retirement plan in place when you are ready to retire, contact our Costa Mesa law firm.

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