You’ve been dutifully contributing to your 401(k) plan for years, possibly even decades. Now retirement is right around the corner, and all of that disciplined saving is about to pay off. If you’re like many retirees, your 401(k) plan may be your single largest retirement asset.
As you’ve saved and accumulated 401(k) assets, you’ve probably asked yourself a number of questions. How much should I contribute? What allocation is best for me? Should I roll my old 401(k) plans into an IRA?
The months right before and right after retirement are often a blur of activity. There are many major life decisions that have to be made in a short window of time. You may be tying up loose ends at work so you can leave on a good note. You may be examining your investments and developing an income plan. You also are likely making personal decisions about downsizing, travel or even relocation to your dream locale.
One major planning point for retirees is transitioning from employer-sponsored health coverage to Medicare. For most retirees, Medicare is an important benefit. Traditional Medicare—consisting of parts A and B—covers hospitalizations and most costs associated with doctor visits. Part D helps with prescription drug costs.
The “sharing economy.” It’s one of many ways that the internet and our new digital society has upended the way we do business. For the uninitiated, the sharing economy is based off of the idea that you can earn supplemental income by simply “sharing,” or renting, assets that you already own.
An example is Uber, with which you use your own car to give people rides and earn income as you do so. Another is Airbnb and other property rental sites, which allow you to rent your home, vacation property or even a spare bedroom to another person. There are even sites that allow you to rent tools, yard equipment and other types of property.
Every year, Gallup conducts a survey to gauge Americans’ most pressing financial concerns. For the 16th year in a row, Americans have said that “not having enough money for retirement” is their biggest concern. In the 2016 study, 64 percent of Americans expressed concern about retirement.1
It’s an understandable concern. Now more than ever, the burden is on the retiree to accumulate enough assets to support a multi-decade retirement. While some retirees may have a pension available, many will rely on some combination of Social Security and distributions from their personal savings. Given the scope of the challenge, it’s easy to see why many workers are concerned.
Carstens Financial Group focuses on providing comprehensive asset management, estate planning and life insurance solutions. Allow us to help you secure your financial future.