Financial Tips for Newly Retired Seniors

Retirement is an exciting time. After decades of working, many seniors look forward to taking life at a slower pace. Maybe to you, retirement means finally having time to travel the world. Or explore a hobby you’ve always enjoyed. Or perhaps you see it as an opportunity to spend more time with family and friends. No matter how you plan to spend your retirement, it’s important to consider your financial health. Because even though you’ve spent the majority of your life saving, like most seniors, by the time you actually reached retirement, you realized that saving money after retirement is also crucial for your future. These quick financial tips will save you financial stress and help you better understand how to make retirement savings matter.

Retirement Planning Tips for a Secure Financial Future

1. Consult a trusted tax & financial advisor

Sorting through all the tax implications and rules of retirement can be complicated. A trusted financial advisor can help you understand the fine print of retirement — helping you identify ways to maximize any tax benefits, while also ensuring you don’t get penalized for things like failing to take the required minimum distributions from an IRA or other investment accounts. Additionally, a financial advisor who specializes in helping retirees can help you organize your finances and come up with a plan to help you maximize your retirement savings and investments as well as saving money after retirement. They can also help you diversify your portfolio so your accounts continue to make money well into your retirement.

2. Look for ways to minimize and eliminate debt as soon as possible

No matter what stage of life you’re in, keeping your debt-to-income ratio low is key for healthy personal finance. This is especially important for new retirees. Find ways to minimize and eliminate “bad” debt such as credit card debt, equity lines of credit and car loans. Maintaining “good” debt, from things that appreciate in value, such as a mortgage,is okay, as long as your mortgage payment doesn’t exceed 28%  of your gross monthly income.

3. Find areas to downsize and reduce recurring costs

Retirement is often associated with downsizing — and with good reason! Many seniors no longer want to be bothered by maintaining a large home, or would like to  reduce or eliminate mortgage payments. Retirement is also a good time to evaluate other recurring costs from sources such as  monthly subscriptions, memberships or services you no longer need or want.

4. Consolidate banking accounts and investment funds

It’s not uncommon to retire with banking accounts across multiple banks and investments across multiple funds. Start by consolidating all checking and savings accounts to one bank. If you have more than one savings account, consider consolidating those as well to reduce banking fees, while maximizing interest benefits. Additionally, move all investment accounts to one financial institution. This can again help reduce brokerage fees while allowing you to reevaluate  your portfolio for maximum results.

5. Factor inflation into your budget

Many retirees start retirement by setting a monthly budget. But many fail to factor inflation into that budget and over time, realize that the initial budget they set doesn’t go as far as it used to. While inflation varies year over year, many financial advisors recommended assuming a 3%  increase. 

6. Regularly evaluate your financial health

Financial planning is often top of mind for new retirees, but it’s important to regularly assess your financial health. Scheduling monthly sit-downs to review all your budget adjustments, social security benefits, and taxes can go a long way to help set aside funds for saving money after retirement. Taking time even just once a year to reevaluate  your retirement plan can help you avoid financial issues down the line.

Planning for Your Future at Sedgebrook

At Sedgebrook, our team is dedicated to each resident’s total wellness – be it physical, mental, emotional, or financial. From the moment you first meet with a Sedgebrook team member to the day you move in, we walk you through every step of planning for your future here. And whether your goal is saving money after retirement or leaving a nest egg for your family, we can help you achieve it. If you’d like to learn more about our Life Plan Community, reach out to us any time, and one of our team members will be happy to answer any questions you might have.

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