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Did you know 36 percent of Americans don’t think they will have enough funds for retirement? Planning for retirement takes some organizing. If you need some tips on when to retire and prepare adequately, keep reading.

In this financial guide, you’ll learn the best age to retire and how to plan if you haven’t already. If you’re in your 40s or 50s, preparing for retirement doesn’t have to be a major stress.

Ready to learn more? Keep reading.

1. Start Building an Emergency Fund

No matter your age, significant expenses will pop up. You should start establishing an emergency fund to handle these surprises.  Use this backup fund during a season of unforeseen costs or hardships.

Most people will aim to have three to six months of savings. To have financial independence in retirement you will also need some extra savings. Think about how you will increase your safety net while also adding to your retirement funds before you retire.

2. Think About Your Retirement Lifestyle

You should think about what life will look like during your retirement years. Do you hope to have a particular lifestyle? Would you like to still pursue specific passions or hobbies or travel with your family once a year?

Understanding these elements and adding them to your savings plan will help you determine how much you will need to save.

3. Consider Whether You Will Move 

Some people need to consider moving when they are ready to retire. You might end up relocating near your aging parents or your adult children.

Would you rather be near family? Then think about relocating. If you already live near family, consider downsizing. You’ll have an easier time aging in a smaller home. 

4. Get Long-Term Care Insurance

Another factor to consider is investing in long-term care insurance. This kind of insurance will alleviate any financial burdens if you need long-term care.

People who can’t rely on their partners or family for care, or have a family history of chronic illnesses should look into long-term care insurance options.

5. Don’t Delay Estate Planning 

If your partner passes on before you, you will need to get organized with your estate planning. How will you distribute your assets? Will you pass them on to nieces, nephews, children, or a charity you love?

Consider your financial and medical power of attorneys. If you can’t decide, you will feel at ease knowing someone will handle these situations for you.

Learn more about some common retirement transition challenges to consider.

6. Invest in Medical Insurance 

Pre-retirees don’t always understand the importance of getting private health insurance. Sometimes, people think nothing bad will happen to them, because they’ve been fairly healthy. 

If you retire before turning 65, you won’t be eligible Medicare and will need to obtain alternative coverage. The premiums for private health insurance will consume a large portion of your savings. This could end up affecting your retirement finances, but alternative coverage is available if you shop carefully. 

Under the Affordable Care Act (ACA) a health insurance company can’t deny you coverage. They also can’t charge you more for any preexisting conditions. 

Find out more about your partner’s health insurance, and any retiree health insurance benefits that might be available to you.  

7. Begin Lowering Debt

Another way to prepare for retirement is to begin getting rid of debt. Debt and credit card balances will affect your ability to retire. If you are serious about saving for retirement, consider paying down your debt. 

Start getting rid of unnecessary subscriptions and monthly memberships. Try putting that money away toward reducing credit balances. 

Make sure you pay off the debt with the highest interest rate first, then move to the next highest interest rate debt. 

8. You Should Keep Your Investments Balanced

Diversification and asset allocation remain critical. If you’re in your 40s, don’t play it too safe. You should have some of your portfolio weighted toward stocks.

Stocks are a volatile asset, but they have a better total return over time. 

9. Choose a Reputable Financial Adviser

A lot of Americans feel worried about retirement. Alleviate some of the stress of retirement.

You should look at working with a financial adviser to help you navigate these different challenges.

They will create a plan that will balance your income and needs, while also establishing priorities for retirement. 

Start Preparing for Retirement Today

We hope you found this guide on preparing for retirement helpful.

You should work with a trusted financial advisor if you need help determining how to plan.

Need some help planning for the future? We’re happy to help you take these critical next steps and plan for retirement. Contact us today.