What can you do to prepare for retirement? It's important to look at five key items to set yourself up for success.
Hello, welcome to Arista Advice. Question of the week is: "Paul, what are some things we can do to prepare for retirement?"
Just this week I had the opportunity to visit with three great people who are in the process of selling some of their ranch land and farm land to their kids and are asking, "Paul, what are we missing? And what else can we do?"
Let me share with you some statistics. There's a shocking survey that just came out recently by the Rand Corporation that shows almost 40% of those who are retiring are now going back to work, and over the last 20 years the share of Americans working in their 70s has risen from 10% to nearly 15%, a 50% increase of those that are in their seventies that are going back to work.
Could they be going back to work because they just want to be productive, continue to contribute to society, and keep their mind going? Potentially. Is it a bad thing? It might not be, but I just share these statistics with you to help you understand the big picture.
The five things that people can do:
Number one: write down your income and expenses. We are seeing that many people are overspending, and their overspending is leading to a lifestyle of overspending, so be careful.
Number two: don't underestimate the importance of taxes with a Biden-Harris presidency, they've already indicated that tax rates are going up. It's really important know what tax bracket you're in. Do you know what tax bracket you're in? If you don't, give us a call. Let's talk about it.
Number three: consider health care costs. The biggest expense in retirement is healthcare costs. Have you funded your health savings account for 2021? If not, let's discuss it.
Number four: know the intricacies of Social Security. Billions of dollars is wasted by many people who tap into Social Security too soon. Know when the best time is to tap into Social Security and do it right. Use other assets before you tap into Social Security is the best strategy, and number five: consider reducing your debt. So it's important to reduce your debt and have no debt going into retirement. Don't be lured by low interest rates. Be debt-free and have no mortgage going into retirement.
Hope you're well. Have a great week. Remember to go to AristaWealth.com to look at tools, tips, and videos. We look forward to talking to you soon.