Why Planning for your Retirement is so Crucial

By Anna D. Banks, GCDF

In the age of modern medicine and technology, you will live longer, remain active longer, and have a fuller life after you retire from your current career. This is precisely why planning for your retirement is so crucial. The first step is to evaluate your retirement needs. Figure out whether you have enough money to fund the retirement lifestyle you wish for, if you retire today. This can be a difficult question to answer as it involves so many variables. However, it is important if you wish to attempt any kind of planning for your retirement.

For coming up with a decent and workable pre-retirement calculation, begin by asking yourself some basic questions:

• What is the current market value of your total investment portfolio, including the pension plan and savings?
• How much do you actually invest every month?
• What would be the best rate of return that can be generated on your investments until retirement age?
• What will your investments be worth when you retire, based on these calculations?

The next step is to come up with a good calculation of how much you should have at retirement. Ask yourself:

• How long do you expect to live?
• How long should the money last?
• How much money would you need per month?
• How much income do you expect from the government?
• How much income do you expect from company pension plans?
• How much will your personal retirement portfolio give you, and for how long?
These calculations can be quite complex, however, many websites and calculators exist that will help you to find the answers. Using one of these retirement calculators or retirement planners enables you to evaluate your retirement needs quite quickly and simply.

The quality of life that you want to lead after your retirement depends on what you are willing to contribute to the fund today. Everyone wishes to retire with peace of mind, which is why planning for your retirement is so crucial. The kind of retirement you can look forward to depends on the planning and investments you are willing to attempt now.

Remember that Social Security will only be able to provide around 40% of the necessary income for a comfortable retirement. Company pension plans are also no longer dependable as once they were thought to be. Increasingly expensive health care costs combined with inflation and a much longer life expectancy will affect the total available retirement income. It is ever more essential to develop a plan and reach your retirement goals. If you haven't started planning for the crucial retirement fund, begin now. Building enough financial stability during your retirement years will mean a proactive campaign of accumulating assets and savings.

As a general rule, experts say, that you will need 60%-80% of your current annual income to maintain a good retirement lifestyle. Your retirement funds need to be enough to support your lifestyle considering such factors as where you wish to live, activities or hobbies you may want to indulge in, and fulfilling long-awaited pursuits such as travel.

© 2007 Anna D. Banks, GCDF
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Author's Note:
Do you have any questions about career development or lifestyle changes for Baby Boomers, which you think others, like you, would want to know the answers? Please leave your comments on this blog or email your questions to me at Anna@AnnaBanks.com.

Does Your Retirement Plan Cover Health Care Issues?

By Anna D. Banks, GCDF

One of the most essential and basic questions of retirement planning, is the one that is unfortunately also the most ignored: does your retirement plan cover health care issues? It is important to start thinking about health care issues as you begin planning for your retirement needs. Always remember that planning ahead will protect you and your family from the possibility of having to pay considerable health care costs, or worse, being unable to afford health care or long term care when you need it.

Always take the necessary steps to protect your financial future as well as to plan ahead for your health care needs. As a generality however, most people do not pay enough attention to this very important aspect of life planning. A large number of people, pre-retirees as well as retirees, readily agree that health is one of the most important issues in retirement. However, almost no one really spends enough time actually planning for health issues in retirement. Most pre-retirees do undertake some kind of planning for the financial aspects of retirement, but seem to neglect understanding and planning for health benefits options.

Planning for medical issues during retirement takes more than just planning the financial details. It would, in fact, involve reevaluating your routine and budget, exploring the health care options, and researching Health Savings Accounts, long term care options and life insurance options. Even though most pre-retirees are willing to pay for prescription drugs and doctor's visits during their retirement, they seem to have a very unrealistic view of what it will cost. Most people anticipate costs to be less than $300 a month for health care-related expenses whereas, in reality, the average retiree actually spends around $640 a month.

In short, most Americans are confused about health benefits and do not really plan for a healthy retirement as well as a financially stable one. Most people don't even have a realistic idea of how much money they spend on essentials each year. To help people like that, many websites offer a health expense calculator that estimates your annual health expenses, including all your medical costs, dental costs, ophthalmology costs, and the total amount spent on prescriptions, for the entire family. These calculators can help you to understand how much money you would need, to meet all your medical expenses.

They are, in fact, invaluable tools in planning health benefits and financial needs after retirement. Having a retirement plan that covers health care issues is vital. The risks of both heart disease and diabetes increase as we age. This is another reason why planning for retirement should include a sensible diet, exercise, and active control measures against any chronic illness.

Research and gaining updated information would be an important step in making the right decisions for a healthy post retirement lifestyle. There is also a major financial incentive, for retirees to try to stay healthy - economics. A healthy lifestyle and healthy habits developed now will be helpful in protecting your financial well being after retirement.

Baby Boomers - Can Pre-Retirement Planning Online Seminars Help You?

Retirement is a subject that you cannot afford to postpone for long. It is an issue that needs to be dealt with sooner, rather than left for later. Pre-retirement planning online seminars can prove to be beneficial to not only those who are nearing the age of retirement, but also in the case of those who would like to start early preparations in order to secure their future.

These seminars provide all the useful information on how to create a financially stable plan that can be executed in order to yield a sustained retirement income. These cater to every individual phase of a career, irrespective of whether you are just in the initial stages or at the peak of it. In these seminars, you get an opportunity to avail of some sound advice from some of the well known professionals from different walks of life. In short, online pre-retirement planning seminars are a feasible solution to help you to financially secure your life after retirement.

Besides providing all the essential data on how to go about planning for your retirement and preparing you emotionally so that you can make a comfortable switch over, they also focus on the retirement process by teaching you the basics. They address when to retire and various other post-retirement considerations that you need to take into account, before you finally decide to retire. Online pre-retirement seminars are also an ideal source of information on numerous other topics like the 401(k) plan, the social security benefits, and other emotional and financial issues associated with retirement. These online seminars also discuss and teach you how to calculate your retirement income after you have considered a broad range of factors influencing it. These include the ever rising rate of inflation, diversification of your financial resources in different options, investing in insurance policies and retirement programs.

Undoubtedly retirement can be an exciting period in a baby boomer's life, but at the same time it can also prove to be very challenging transition. An online pre-retirement planning seminar deals with topics like the eligibility requirements for various payment options that one can avail of after retirement, ways to accumulate your retirement income, making emotional adjustments after retirement, pension plans, learning to maintain legal transparency, planning for health care facilities, tax deferred annuity accounts and assistance with financial planning. These seminars are perfect for baby boomers and employees from all age groups since, they not only address the needs and requirements of employees above 50, but also those under the age of 50. They offer counseling services and are very often provided by the companies that the employees are working for.

In addition to the online seminars, many companies also make an effort to provide their employees with regular pre-retirement sessions that give their personnel a chance to interact and clarify any doubts that they may have regarding retirement. Most of these are free of charge and are offered to all the eligible employees of the company. The term 'eligible' here implies to all the active and regular employees. Very often, the working spouses of the eligible employees can also avail of these offers.

What are some of the online pre-retirement planning programs that you have explored? I'd love to hear from you.