These are the top retirement questions you should ask yourself if you are age 50 or up so that you can figure out how to shape and pay for this phase of your life.
It may be true that planning for retirement used to be simpler a half-century ago. Our parents had more traditional career routes to follow during the post-war years and benefited from an economic system that generally remained profitable after surviving the Great Depression.
It wasn’t as difficult to account for sudden changes in the economic climate; the paths they followed towards retirement had a more limited number of options and choices to make.
Retirement Questions as a Senior
Of course, as children, we didn’t know exactly what our parents were doing with their retirement strategy. And we probably wouldn’t have understood them if we did.
But today, many of us are facing the questions they asked themselves—only there are more of them, and we have to ask those questions much sooner and more fully than they might have.
While many of the fundamentals of impending retirement haven’t changed all that much, we live in a different world than our parents did.
Financial markets and realities are controlled by multiple factors that didn’t exist back then—including technology, new investment schemes, more economic volatility, and changes to the old institutions our parents relied on.
That means we have to start asking ourselves the important questions earlier in our lives than they did.
If you’ve hit your golden years and turned 50, here are some retirement questions to consider about how to shape and pay for this phase of your life.
What are my plans for retirement?
Remember when your father or mother cornered you as a teenager and demanded, “What are you going to do with your life?”
Ask yourself that same question now (in a less impatient tone).
Think as big as you want:
- Do you want to travel more?
- Are there pursuits or hobbies you want to follow?
- How long do you want to live in the place you’re in now?
- What’s the vision that you have for your life in twenty years?
There aren’t any wrong answers to this question. (Well, maybe a couple, but not many.)
The idea is behind asking it is to give yourself a goal to plan for.
Situations may change those plans over the next few years but having an overall lifestyle to shoot for makes it easier to shape your plans in the present.
How am I investing my money today?
Many of us entrust our financial investments to licensed brokers and professionals, but a whole lot more of us are steering our retirement strategies ourselves.
With everything else that goes on in our lives, we don’t necessarily pay the same amount of quality attention that a broker would.
Even if one keeps on that same, self-directed track, they can still benefit from investigating what their current investment master plan looks like:
- How much debt do I owe? Credit card balances, mortgage payments, IRS bills, and even lingering student debt can severely limit our financial flexibility after 50. We need to start thinking about how to free up those responsibilities for the future when we’ll need to have more access to our financial accounts.
- Should I diversify my assets? Those of us lucky enough to spend a long time with a certain organization may have received company stock options as partial compensation. But tying up all of one’s portfolio to one entity is, usually, a little chancy, as they’re depending on the profits of only one company. Are there other investments that could reap more benefits in the future?
- Am I using the right IRA account? Seniors of the future have more options for their individual retirement accounts than in the past. In addition to traditional and Roth IRAs, there are employee-funded SEPs, nondeductible IRAs, accounts for the self-employed, spousal IRAs, and maybe a few more that are slipping our minds at the moment. Review your IRA account and consider what changes you need to make.
- Am I contributing enough towards retirement? A question that dogs almost everyone the minute they start pulling in a regular income: How much am I socking away for the future, and will it be enough for the plans I have?
- Should I get a financial advisor? While it’s easier to get answers on your own than ever before, sometimes those answers may be inaccurate, insufficient, or misleading. It’s worth asking your friends how they get their financial advice or finding a trustworthy consultant on your own.
“One of the most important lessons that can be learned is that what we ‘see’ may be different than what is actually in front of us,” says financial expert Mark Singer.
Get a realistic outlook on where your investments are right now as you work through your retirement questions.
What might my medical insurance needs be?
Many of us put off considering our future health concerns when we’re young, simply because it reminds us that we’re mortal.
But even if you’re relatively healthy, taking a realistic approach now could save a bunch of headaches, anxiety, or digestive problems later.
Medical insurance, of course, has been a topic of some heated political discussions over most of our lives, and likely those controversies won’t stop. That makes it all the more important to take rational stock of what you might need from Medicare, private plans and supplemental insurance as you get older.
Will you need a comprehensive, all-encompassing plan? Or will you have enough to front for minor costs yourself?
This retirement question is especially important for those with current medical issues, or a family history of health issues.
The old adage of “planning for the worst, hoping for the best” always applies.
But you don’t have to fear asking this question—in fact, the less you ask it, the more valid those fears will become.
How will I manage my income as a senior?
No matter how big your nest egg might be at the moment, just because you’ve retired doesn’t mean you won’t be adding to it.
Some of us will continue working after we reach retirement age, whether due to financial need or personal fulfillment. Others of us will need to rely on other income generators to keep us going.
Diversifying your portfolio, minimizing taxation, overseeing your pension payments, and strategizing against inflation are all options that will be available to you in the future.
And even though economic realities may change, it’s always worth planning for, thinking about the fundamentals we have now.
Consider how you’ll maximize your financial position, even when your main income source may change after you’ve retired.
Whether you plan on working a lot, a little, or not at all, you can still orient your thinking toward remaining financially solvent as a senior—maybe even profitable.
As children, we always thought about the future. So it’s a frame of mind we’re already familiar with.
Even if our lives turned out differently then we might have envisioned as kids, we can still consider the realities of our retirement years with optimism, but with a little bit more to plan for. And there’s no better time than now to do so.What’s your FICO® Score? Find out now with a purchase of your Experian Credit Report for $1 with enrollment in Experian CreditWorksSM!