What can I reasonably expect from my retirement in this day and age?
Retirement is meant to be a time of rest and relaxation. However, our impending debt crisis has put in jeopardy several social services, including social security and Medicare (two programs of particular interest to retired seniors). Having a comfortable retirement requires a great deal of planning, to ensure financial security during those years. As you’ll no longer have an income earned from your career or job, you’ll need to make sure you can maintain your lifestyle through use of savings and government aid (or accept the reality of living a different lifestyle).
Some wonder, though, whether socialized retirement aid is the most dependable option. Recent attention given to our national debt crisis (and the potential cuts that could be made to programs such as Social Security and Medicare) has only exacerbated these concerns.
The most important thing to do, no matter what your situation (or that of the government’s) is to use any available channels you have to start saving for this time in your life, as soon as it’s possible for you to do so. You can even use your whole life insurance policy toward that aim. To find out how, reach out to BeamaLife by visiting our Web site or calling (877) 972-3262.
A Post for the Men
Whenever financial conversations are split along gender lines, a majority of the discussion tends toward fiscal issues that face women. There are, in fairness, a great many issues that can be discussed in regards to gender inequalities that negatively affect the fairer sex. This time, however, we would like to focus on the men.
It is often assumed that men, due to their continued ability to earn more than women employed in the same capacity, should have an easier time saving money, an easier time supporting a family and an easier time making large purchases. Stereotypically cast as the breadwinners, the dominant gender, the hunters and gatherers of society, men are held to incredibly high financial standards, and are sometimes made to feel like failures if they happen of all short (even if they do so because of circumstances beyond their control).
The truth of the matter is, the economic downturn has been rough on everybody, no matter what gender, race or religion they happen to be. But according to the results of an extensive survey coordinated and conducted by Men’s Health Magazine, men are finding ways to survive all the same. Even those who put the survey together admit to being pleasantly surprised with the results.
Some of the more interesting findings revolve around the participants’ perspective on their personal finances. The men asked seemed optimistic about their finances, and about the fiscal picture they saw painted for their future. Many wished to make more money, but that is a symptom suffered by most people, no matter who or what they are.
There were, of course, some less surprising elements, especially in regards to the sort of happiness and satisfaction men would find in having more money – as well as some rather unsavory ones (consider this a warning for those easily offended). But overall, it seems the recession from which we are still presently recovering (and will be for a considerable length of time) has not dampened the spirits of men overall.
For us, the biggest cause of concern is the lack of saving the participants had admitted to doing, both in regards to emergency funding and retirement planning. No matter who you are, there are two things that you need to do – save, and save more. Having adequate money put aside for the times in your life when you don’t have a steady or adequate income (namely, when you least expect it, and when it comes time for you to retire) is incredibly important.
We hope the optimism displayed continues to prevail through stormy economic seas, but we also hope this isn’t a foolish optimism, that leaves people unprepared at the most inopportune times.
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Retirement planning 101
When it comes to retirement planning, and discussions regarding retirement plan options, pension plans are one of the first resources brought up in conversation. The term “pension plan” is an umbrella statement though. There are numerous kinds of pension plans out there, and learning about them will help you know what you have at your fingertips for your retirement planning and strategizing.
Generally speaking, there are three types of pensions – employment-based pensions, social and state pensions, and disability pensions. The first (an employment-based pension) is the sort of pension plan a business in the United States would offer its employees for aiding in their retirement planning.
Employer-sponsored pension plans are funded, for the most part, by both the employer and employee. Most pension plans are managed on a “defined benefit” basis, which essentially means that contributions to the plan are made on your employer’s end based on a predetermined formula, rather than by using investment trends to dictate contributions.
These plans are tax-deferred, meaning that the money accumulating in a pension plan for your retirement is free of taxation until the time at which it is paid out to you. This is another very attractive feature of pension plans as a savings vehicle for retirement planning.
To know more about what pension plans your job offers, if any, and how funds are contributed to it for your retirement planning needs, have a retirement planning or financial planning professional take a look at your work-sponsored benefits package. They will be able to read through facts, figures and legalese to break down for you the benefits offered in terms of retirement planning and saving.
Also set aside time to talk with your human resourced department, to learn about the potential programs and benefits they may offer toward your retirement planning. Don’t be afraid to talk with them – your human resources department (or supervisor, in the absence of such a department at your place of work) is there to help you in any way they can.
Either your human resources department or supervisor, or a retirement planning professional, can talk to you about the other retirement planning tools in your benefits package, such as 401Ks. It is important to understand everything that is available to you when setting up your financial future after you no longer have an income on which you can rely.
Also remember that no time is too soon to start working on retirement planning – the time will pass by faster than you realize. The last thing you want it to be unprepared for your retirement when the time comes for you to leave your job and move on to the next phase of your life. Don’t miss the chance, while you have it, to carefully put together a retirement plan that works for you.
To learn more about retirement planning in general, look through the articles on our blog and Web site regarding retirement plans, the components that go into them, and your options regarding the construction of your individual retirement plan. You may also feel free to reach out to us for all of your retirement and pension planning needs.
What would happen to me without retirement planning?
Depending on your age, it may be tough to even conceive of one day being retired. Especially if you are younger, your retirement seems a lifetime away. In a sense, you are not wrong in this assertion. But the years pass by faster than you may realize.
Without prudent retirement planning factored into your overall financial picture, you’ll be, in essence, doing a great disservice to the “you” of tomorrow by not taking time today to plan ahead to your retirement. Leaving yourself scrambling for money and racking up debt after you retire is, to put it lightly, not a desirable option.
Your retirement years should be the golden years of your life – the time when, after working so hard for so long, you can finally relax and settle into the later phases of your life. Careful and well-thought-out retirement planning can help you ensure that your retirement is exactly that. Through retirement planning, you can make sure that not only federal and personal funds are available, but those provided through employer-sponsored programs as well.
Retirement planning will examine your work-funded/work-supplemented options (such as various pension plans, stock options and other profit-sharing plans, or 401Ks), your Social Security benefits as they stand (by helping you request a statement from the government using the proper channels to get detailed information on where you stand), and the ways in which you can contribute personally to your retirement funding (through investment and savings options).
Don’t wait to plan for your retirement, only to find yourself without ample time to set up adequate funds to continue affording your present lifestyle. Read more about retirement planning and defined benefit plan here on our site, or reach out to us for advice and guidance toward piecing together a retirement plan that will have you taken care of in the twilight of your life.
Understanding Medicaid
The United States government offers a health program called Medicaid, which provides health care and insurance for individuals and families alike that come from low income and low resource situations. State and federal governments work together to fund Medicaid.
There are two types of Medicaid – policies that help individuals with no medical insurance (or close to it), or policies that help families with a similar dearth in medical coverage. These programs can help greatly with getting basic coverage for children, who need preventative, primary and developmental services. Medicaid is also at the forefront of providing medical coverage to qualifying persons who are HIV positive, where their disease has progressed to AIDS status. Medicaid also provides very important dental coverage to families who could not afford it otherwise.
And it is absolutely true that Medicaid can fill some of the needs one may need as it pertains to long term care. However, due to the nuances inherent in discerning who is qualified and who is not, and the particulars of what specific services are covered, you may not find yourself with many long term care options. Also, you are limited to the facilities, persons and entities that are approved for Medicaid coverage – and Medicaid coverage is not a universal provider.
So while this program can be useful, and certainly has its merits, there are inherent flaws and gaps in the sort of coverage you can receive from a Medicaid policy. That is why having a long term care insurance policy ready to help you out in your hour of need is best. So reach out to us today (and look through our Web site at the various articles we have available to you, to educate you about the benefits of long term care insurance and obtaining a long term care insurance rate that works for you), for specific advice as it pertains to your long term care needs and goals.
Understanding Medicare
Medicare is a program sponsored by the United States government that provides health care and coverage to those who are over 65 years of age (or who meet other criteria). It works in much the same way an individual health care policy would.
Anyone who falls into the qualifying age bracket is eligible, provided they are legal citizens in the United States of America for at least five years. Anyway under the age of 65 but grappling with disabilities may be eligible if they are already receiving Social Security Disability Insurance benefits. There are also medical conditions that, should a person be suffering from them, qualify them for Medicare assistance.
Premiums for such coverage from Medicare (and Medicare Part A) are waived entirely if the person fits the qualifying criteria. However, if you and your situation do not land you in the specific parameters that qualify you for Medicare coverage, then you will be left without many other options. And keep in mind that eligibility is subject to review, and is given at the discretion of the American government.
There is also often confusion regarding the nuances in what type of coverage you receive from Medicare and its different parts (Part A, which covers hospital care, Part B, which covers medical insurance, Part C, which offers Medicare Advantage plans and Part D, which covers drug prescriptions, all exist, as well as Medigap policies, which could help with premiums, deductibles, and coinsurance, but not entirely). This is why having a long term care insurance policy for yourself is important. At the very least, it would be worth your while to get yourself long term care insurance quotes.
Talk to us today about your specific situation. We’ll tell you the honest truth about what sort of coverage would work best, and for what you would or would not qualify. We’re on your side, and we want you to have the best long term care insurance possible, with the lowest possible long term care insurance rates to pay.
How can one switch careers later in life without ruining their finances?
An economic climate that has fostered lay-offs, coupled with a growing societal embracing of bucking tradition, has led many to reconsider and even permanently alter their career paths. Some even as late as their 40’s and 50’s are switching proverbial gears, moving from a career in which they worked diligently from many years into an endeavor that speaks more to their passions and deeper goals (if they were not already employed in a vocation which fostered such things).
It’s an interesting phenomenon, and it’s not altogether a negative trend, to see people taking the plunge toward doing something they’ve always wanted to do. But as with any major decision in one’s life, there are financial considerations to keep in mind.
No matter when you make this shift, you’ll want to consider what you have set aside for your retirement years. Hopefully, if you are approaching senior citizen age, you have already begun to plan for your retirement plans, setting aside money in a savings account, as well as in a pension plan such as a 401k or an IRA. If you have one of these plans, find out whether or not it can be transferred over to a new job, once you find one.
In addition to that consideration, you’ll want to make sure you have enough money saved in general to pay for all of your necessary expenses, in case your new venture does not immediately turn out to be profitable. And you’ll need to consider your health insurance options without an employer-sponsored plan to cover you.
Pursuing your dreams is an admirable thing, and it takes guts. But it also requires careful consideration and planning, lest you be left in a financial lurch (and worse, lest you drag your family down with you).
Is being a senior employee still considered a positive attribute, or is experience less important than energy in today’s job market?
It seems the answer to this question depends on who you ask. According a recently-released Associated Press poll, many seniors view themselves as a great asset in the office, due to the irreplaceable wisdom imparted on them by years of experience and hard work in their field.
However, many that are younger view age as a liability, and older employees as less reliable than their more youthful counterparts (due either to the suspicion that they’ll retire sooner, or concerns for their health in relation to their age).
Ultimately, the answer is an important one, though, for many of those who are nearing, are at, or have aged beyond the standard retirement age of 65. Depending on the sort of retirement planning these individuals have implemented over the years, many may find themselves in a position that requires them to work into their golden years. Knowing the likelihood of getting a job in their field of expertise will help these people put together a plan of action that works for their needs and with the availability of job opportunities (considering their age).
This is one of the many reasons why it is important to implement retirement saving into your overall financial planning efforts as soon as it is possible for you to do so. This way, as 65 approaches, you will already know where you stand financially, and what – if anything – you’ll need to do to have financial security in your later years.
How do CDs and fixed annuities compare to one another as retirement saving tools?
Both CDs and annuities can be implemented into your retirement planning to help protect and even cultivate growth in your accumulated wealth. However, they do so in very different ways. In fact, one of the few unifying qualities is that they are both inherently low risk savings options.
One of the biggest delineations to be made between the two pertains to their respective longevity. In short, if you seek a short-term gain, you should go with a CD, as it comes with different maturity period options (ranging from months to years, depending on preference). If you seek a long-term gain, though, a deferred annuity is the better choice, as it can help you save money long into your retirement – and even after you’ve passed away, allowing you to leave it as a legacy for heirs.
There are also differences in regards to tax implications (both on the money itself, as well as on Social Security benefits) and the availability of the money. With CDs, you have access to your money at any time, but whether it’s used or not, the money is subject to taxes. With annuities, there are rules regarding how and when you can take out money, but said money enjoys a tax-deferred status.
Can whole life insurance be used as a retirement planning supplement?
Yes, you can use the savings component of your whole life insurance policy to supplement your retirement planning and saving. In fact, a whole life insurance retirement savings plan operates in a similar fashion to a Roth IRA or Roth 401k. It enjoys the same tax-deferred status (avoiding income tax and IRS penalties), making it a powerful retirement savings tool.
The biggest benefit of using whole life insurance for retirement saving is that you not only provide for retirement income, but you also have a death benefit to be paid out to your family for their continued fiscal security.
You’ll also have options in regards to how you receive the payment – be it in regularly timed intervals or at the random need or discretion of the policy owner. A whole life insurance policy such as this even comes with a “waiver of premium” rider that mandates the life insurance company to handle premium payments until you either retire, or up to age 65, if you are rendered disabled.
