FINANCIAL LIFE STAGES — WORK PEAK
WORK PEAK: IS IT ALL DOWNHILL FROM HERE?
These are unusually the big money years where you have reached the top of your career. The kid’s may be gone and life has settled into a predictable rhythm. This is the moment to begin saving as much as possible especially if you have fallen short of your savings goals to this point. It’s also time to plan for life after work. How will you spend your time? What do you value? As much as you might want to travel, buy a second home, have new cars and other luxuries, most of us have to choose our luxuries since the money saved needs to last for the rest of our lives.
HAVE I SAVED ENOUGH FOR RETIREMENT?
One of the most common questions from clients does not have an easy answer. The factors to consider when answering are infinite and have a lot to do with lifestyle, goals, retirement plans, children’s needs and legacy to name just a few. For most, in the beginning years of retirement, the income needed is not much less than the income earned pre-retirement. As you age, health could become an issue and is a factor that is often unpredictable as is longevity. It may seem obvious, but the more you have saved for retirement, the better chance that you will not run out of lifetime funds to support yourself. The work peak phase of life is the time to take steps to answer this question while you have additional years to save or can plan for a post-career career to lessen the impact on your retirement savings withdrawals.
WHEN SHOULD I COLLECT SOCIAL SECURITY?
The biggest insurance decision of your life, choosing when to take Social Security can make the difference between a more comfortable or less comfortable lifetime income base. Collecting Social Security at age 62 or waiting until age 70 is a differential of 57% in the amount of benefits and that’s not including the addition of cost of living increases. The Social Security handbook has 2,728 rules so it’s no surprise that knowing the best time to take these benefits is confusing, at best. And to add to the difficulty, employees at the Social Security Administration do not give advice on how to maximize your benefits.
Our Financial Wellness for Life program includes a Social Security maximization strategy.
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Better Money Decisions, LLC, is currently registered in the State of New Mexico.