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Top Ten List of Retirement To-Do's


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Top Ten List of Retirement To-Do's

  1. 1. Top Ten List of Retirement To-dosSUBMITTED BY TOM VILORD, PRESIDENT – VILORD WEALTH ADVISORS,TURNERSVILLE, NJINFO@VILORDWEALTH.COM, 877-VILORD1Who better to ask for guidance on retirement than those who are living it now? Nationwide Financial and consumerresearch company Yankelovich surveyed current retirees to find out their top to-do’s on preparing for retirement.Check out their responses below.1. Monitor your investments in pre-retirementFor many, keeping a close eye on their investments is easier said than done. While 43% of retirees said they monitortheir investments more closely now than before they retired, the number one mistake cited by retirees wasoverspending.Its often important for retirees to find investment options that provide more predictable sources of income, according ®to Nationwide . However, retirees should be aware that more predictable income in retirement may cost them - eitherin terms of lower returns from conservative investments or the higher cost of insuring more volatile investments.Insurance protections are subject to the claims-paying ability of the issuing insurance company. Thats why itsimportant for retirees to evaluate their options and understand that the money they need in the next 5 - 10 years ismost vulnerable because its also the most crucial - if lost, that money is very difficult to recover over time.2. Plan for rising prices/inflationA penny saved is a penny earned, right? Not always.Broad economic factors like inflation and rising prices can chip away at the buying power of longer-term investmentslike your retirement fund. Recently, the U.S. economy has seen retail gas prices hit all-time highs and the worst food 1inflation in 17 years.When planning for retirement, it’s best to assume prices will rise and inflation will increase. One simple way to keeptrack of broader economic factors is by monitoring the Consumer Price Index.
  2. 2. 3. Talk with your spouse or significant other about how much you can spend inretirementIt’s important to be open with your spouse or significant other about how much you think you should, and will, spendin retirement so that you’re both on the same page. Similar to the way couples discuss buying a new car or a housewhile working, they should talk through important financial matters in retirement as well.According to Nationwide’s survey, 93% of retirees responded that talking with a spouse about how much they canspend in retirement is important.4. Focus on physical healthIn light of increasing health care costs, focusing on physical fitness today is critical to remaining fiscally fit inretirement.Recent findings by the National Retirement Risk Index illustrate that the high cost of health care is often overlookedby retirees, despite the fact that this cost is climbing 8% – 10% each year. Health care expenses can certainly burden 2your finances when you consider that the average hospital charge for coronary artery bypass surgery is $92,242.5. Put yourself on a spending budget
  3. 3. The best way to plan a budget is to know how much you can spend. Unfortunately, only 52% of people have evercalculated how much they can safely spend each year in retirement.If you need help starting out, consider meeting with an investment professional, like the majority of people who saidthey calculated their annual spending in retirement. Investment professionals also can provide additional insight andtools to help ensure you stay on track with your plan. Which leads to number six…6. Get a good investment professionalJust as going to the doctor is a smart way to help ensure you are healthy, having an investment professional youwork with regularly is a smart way to plan for retirement.Contact Tom Vilord, president of Vilord Wealth Advisors. Vilord Wealth Advisors is a full service financial planningfirm specializing in Retirement Planning and IRA Rollovers for individuals who have recently retired or who haverecently been laid off. Our email address is or contact us at 856-227-2288 or 877-VILORD1.7. Watch travel expenses in retirementIt’s cheaper and easier to travel when you are mobile, so take big trips when you are younger. Don’t save all of yourvacations for retirement as this will be more costly.Also, don’t take overly expensive vacations. As you are smart about spending when at home, keep the same habitswhile traveling.8. Pay off your mortgageHouses give you more than just shelter. They also comprise a significant contribution to your fixed expenses. Bypaying off your mortgage you can tap into your home’s wealth by living there "rent free" while eliminating a significantmonthly expense.
  4. 4. Making extra payments can make a difference. For example, paying as little as $100 extra per month on a $200,000 3mortgage at 6% interest would save almost $50,000. Some mortgage companies also offer bi-monthly paymentschedules, just be sure there are no fees to do so.9. Work longerAccording to the National Retirement Risk Index, 53% of workers who retire at or before age 63 will be in danger ofhaving insufficient funds during retirement. Interestingly, only 32% of those who retire at age 67 will be at risk.One of the best ways to ensure you have sufficient money well into retirement is to work a few additional years,beyond what you originally had planned. It may not be what you want to do, but it will add more "cushion" to your nestegg in the long run. Even an additional couple of years can add significantly to your retirement funds.10. Last but not least, anticipate spending more money than you thought you would.No matter how much you plan, surprise expenses are inevitable. It’s important to acknowledge this and prepare forthe unexpected. For example, many retirees don’t plan for the cost of maintaining their home and are caught off -guard by property taxes and maintenance costs that may rise substantially during retirement.So there you have it — great information from those already living in retirement. It’s a lot to consider, but important toknow.For example, health care costs are already high, and are expected to continue rising rapidly. Health care costs alone 4can increase the share of households at risk of not being financially able to retire from 44% to 61% . Knowing theimpact it can have helps keep you aware as you plan your own retirement.The good news is, behavioral changes, like working a few years longer, saving a bit more each month and adoptingsome healthy lifestyle habits, can make a big difference. Talk to an investment professional soon about how you canprepare.1 www.usda.gov2 Pennsylvania’s Guide to Coronary Artery Bypass Graft Surgery 2003, Pennsylvania Health Care Cost ContainmentCouncil, March 2005.3 "Paying off your mortgage,", April 11, 2008.4 Center for Retirement Research at Boston College, 2008.SUBMITTED BY TOM VILORD, PRESIDENT – VILORD WEALTH ADVISORS,TURNERSVILLE, NJINFO@VILORDWEALTH.COM, 877-VILORD1