Frequently here on the Blog, we publish articles that are aimed at those already retired, or close to it. But for those whose retirement date is a bit farther in the future – say, a decade or more – it’s helpful to stop every now to offer some general guidance. Think of it as a broad-brush roadmap to help you navigate the years that lie ahead.

In this recent article from CNBC, reporter Lorie Konish provides just such a roadmap, or (as she calls it) a four-step game plan to help those with a bit of time get better prepared for eventual retirement. Konish bases her approach on the sobering fact that confidence in a stable retirement future is dropping due to inflation, lack of savings, and general economic uncertainty. These tips are targeted at someone approaching retirement who is eager to re-tune their plans to help ensure a smooth transition to that next phase of life post-career.

We should point out that, as valid as Konish’s points are, her four-point list is far from exhaustive. Our advice is for you (along with a spouse or partner if you have one) to attend a free LifePlanning seminar with Rajiv Nagaich, the sooner the better. Check our website for upcoming dates. Rajiv also shares a few other important observations and offers a vitally helpful tool to guide you as you plan, so read on.

Does Retirement Feel Out of Reach?

In a turbulent time, says CNBC, the future looks increasingly uncertain. As Konish writes, “For many Americans, a comfortable retirement may feel out of reach.”

Retirement confidence has dropped significantly in 2023, says Konish, marking the biggest decline since 2008 among both workers and retirees. That’s according to a new report from the Employee Benefit Research Institute and Greenwald Research. EBRI surveyed more than 2,500 Americans in early 2023 to garner those results.

“Workers’ confidence dropped to 64 percent from 73 percent in 2022,” the article reveals. “Meanwhile, retirees’ confidence slipped to 73 percent from 77 percent. Two key reasons for the drop are a lack of savings and historic high inflation that is pushing up prices, the survey found.” While those percentages may seem fairly small, any decline in confidence about the future can signal storm clouds ahead for the U.S. economy.

“To remedy that,” Konish acknowledges, “the general advice is to try to set aside more money — though admittedly that is not always easy. But there are also several key decisions retirees face that, when handled properly, can help save more money.”  We’ll take a look at four of them, bearing in mind that some of these are best-addressed several years before retirement.

Decision #1: When to Claim Social Security Benefits

Konish says that there’s a “key deadline” for each of these decisions, and the time to start paying close attention to Social Security is sooner rather than later. “By age 60,” she advises, “you should go to the Social Security Administration website and review your statement.”

As the CNBC article observes, when to claim Social Security retirement benefits is one of the big questions retirees face. “Most experts generally recommend waiting beyond age 62, the earliest eligibility age,” Konish writes. “At full retirement age — 66 or 67, depending on your date of birth — you will receive 100 percent of the benefits you earned. But for every year you delay past full retirement age up to age 70, you will get an 8 percent boost — a guaranteed return that’s hard to beat in the markets or elsewhere.”

Another powerful advantage of Social Security is that benefits are inflation-adjusted, unlike most other sources of income. That means maximizing your benefit can have an increasing impact on your finances going forward, not to mention the added advantage for your spouse if he or she has a smaller benefit than yours and outlives you.

“By your early 60s,” says Konish, “you should be reviewing your earnings record to make sure it’s correct…as that is what will be used to calculate your benefits. At that time, you will also be able to get a sense of how large your monthly benefit check will be if you claim at ages 62, 67 (provided that’s your full retirement age) and 70.”

Decision #2: Determining Your Medicare Strategy

Age 65 is the key milestone here, although we suggest you start gathering information sooner. That’s because, while Social Security benefits can start at age 62, eligibility for Medicare generally does not start until age 65.

“An initial enrollment period starts three months before you turn 65, includes your birth month and goes three months after the month you turn 65 — for a total of seven months,” Konish explains. “That goes for Medicare Part A, which covers inpatient hospital care, skilled nursing facility care, nursing home care, hospice care and home health care, as well as Medicare Part B, which covers diagnostic and preventive care services.”

That makes the months before and after you turn 65 the key time period to watch. But as we advised, don’t wait until the last week of your initial enrollment period: there are a host of variables and complex choices, and you don’t want to make such critical decisions under pressure. Give yourself time to evaluate your options.

What kind of options? For starters, if you have health-care coverage through an employer at age 65, you may decide not to sign up for Part B right away. Once you do enroll, you’ll need to choose between traditional Medicare plus a Medigap plan, or a Medicare Advantage plan. Then there’s Part D drug coverage, included in Advantage plans but not with Medigap supplement plan. Each one of those options comes with a complex array of choices and variables. See what we mean?

“To help sort through the choices,” says CNBC, “the AARP offers a Medicare enrollment guide and other resources. State Health Insurance Assistance Programs, also known as SHIP, also provide guidance to Medicare beneficiaries.” This is also a topic Rajiv Nagaich covers well at his LifePlanning Seminars.

Decision #3: Narrowing Down Your Housing Choices

It’s hard to pick a target age when retirement housing choices become critical, but Konish says the sooner you start thinking about it, the better.

“When it comes to lifestyle,” she writes, “many retirees would prefer to age in place. Yet it’s important to consider whether your current home will still suit you as you age. Mobility issues can quickly become problematic as we grow older, so, as one expert told Konish, “If you plan to relocate, you may want to do it early before health issues set in.’

The age-in-place option also requires advance preparation. “Alternatively, if you plan to age in place, making some upgrades now,” Konish advises, “like putting guardrails or handrails on stairs, may help smooth the transition if and when your health declines.” (We have a related article this week on the Blog.)

Konish spoke with Susan Reinhard of the AARP Public Policy Institute, who observed that there is no one-size-fits-all answer to the retirement housing question. It’s not really about downsizing or upsizing, Reinhard said: “It’s called right sizing for you.”

Decision #4: Setting Aside More Money for the Future

Obviously, saving for the future should start at the earliest age possible. But Konish says that you need to take a hard look at your finances at least a decade before your planned retirement date. “For many people,” says Konish, “the idea of retirement doesn’t become a reality until around age 45.” That’s according to David John of AARP Public Policy Institute.

“By the time you’re about a decade away from retirement, it’s a good idea to give some serious thought to your retirement goals while you’re still working and have time to build up your savings and make other arrangements, he said.”  What’s more, even if you’re not where you want to be, it’s important to start where you are and do what you can. You can still make progress.

“If you don’t have retirement savings at this point, it’s never too late to start,” John said. “Having any level of savings is better than having no savings at all.”

Two Financial Tools from Rajiv Nagaich

This is one area where a financial dashboard will prove indispensable, says Rajiv Nagaich. “The sooner you get a financial dashboard in place, the better,” he advises. “That way, you’ll have a tool to guide all your decisions – saving, spending, investing, and so much more. If I could give one piece of advice to someone 20 or 30 years away from retirement, it would be to have a financial dashboard that lets you make decisions with the future in mind.” Contact us and we’ll be happy to refer you to a qualified financial planner who can help you.

Rajiv has also created a powerful tool that can help people gauge whether they will be able to live out their lives in their own home or have to be forced into institutional care. You can take the “Home Fitness Quiz” at Path to Happily Ever After. It’s a great asset to your future planning.

Breaking News: Rajiv’s New Book is Here!

We have big news! The long-awaited book by Rajiv Nagaich, called Your Retirement: Dream or Disaster, has been released and is now available to the public.  As a friend of AgingOptions, we know you’ll want to get your copy and spread the word.

You’ve heard Rajiv say it repeatedly: 70 percent of retirement plans will fail. If you know someone whose retirement turned into a nightmare when they were forced into a nursing home, went broke paying for care, or became a burden to their families – and you want to make sure it doesn’t happen to you – then this book is must-read.

Through stories, examples, and personal insights, Rajiv takes us along on his journey of expanding awareness about a problem that few are willing to talk about, yet it’s one that results in millions of Americans sleepwalking their way into their worst nightmares about aging. Rajiv lays bare the shortcomings of traditional retirement planning advice, exposes the biases many professionals have about what is best for older adults, and much more.

Rajiv then offers a solution: LifePlanning, his groundbreaking approach to retirement planning. Rajiv explains the essential planning steps and, most importantly, how to develop the framework for these elements to work in concert toward your most deeply held retirement goals.

Your retirement can be the exciting and fulfilling life you’ve always wanted it to be. Start by reading and sharing Rajiv’s important new book. And remember, Age On, everyone!

(originally reported at www.cnbc.com)