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4 Easy Retirement Tips for Seniors from Investment Advisor Phil Town

Experts will always tell you that the sooner you start planning for retirement the better off you will be. While that’s great for people still in their 20s and 30s, what if you’ve already reached the 55-to-65-year mark and want to start planning for your retirement?

First of all, recognize that it is absolutely not too late for you to start taking steps that will make a meaningful difference in your retirement finances. On top of that, even if you’ve been planning for retirement for some time now, there are still steps you can take in the final stages that are sure to make your retirement more successful. With that said, here are a few highly effective and simple retirement tips for seniors.

Retirement Tips for Seniors, No. 1: Set a Budget

man with calculator, to illustrate retirement tips for seniors

One of the best ways to put aside money is to spend less of it. However, if you’ve never taken the time to put together a budget, you may be shocked by how much you are spending on unnecessary expenses vs. how much you are putting aside for retirement.

When putting together a budget, try to dedicate as much as you can to savings. Of course, the exact percentages of your budget will depend on the income and expenses that you have. But the higher percentage of your income you can dedicate to savings, the better. Even if you already have a budget for retirement, now may be a good time to re-examine it and see if you can put more toward savings.

2: Manage Your Risk (But Don’t Stop Investing)

stock market screen, to illustrate retirement tips for seniors

When you’re investing at a young age, risk isn’t quite as much of a concern. If the bottom happens to fall out of one of the stocks you own, you can hold onto it until it eventually goes back up. Even if it never recovers, you have time to recover yourself.

For investors right on the edge of retirement, it’s understandable to be a little risk-averse. However, it’s still important to think about the long term and continue investing for the future. But how do you invest in the stock market while managing your risk?

Buying bonds and other low-risk securities is one option, but it won’t net you a lot of gains. If you want to buy stocks that have the potential to really grow your wealth while still keeping your risks as minimal as possible, it’s especially important to do your homework before investing. Make sure you know as much as possible about the company you are considering and are buying into it only when all the signs are saying that you should.

Another way to manage risk while investing in the stock market is to stick with large, well-established companies. While the prices of companies such as Coca-Cola and American Express may dip up and down, chances are the bottom isn’t going to fall out of them. It’s precarious to call them “too big to fail,” but with companies such as this, it’s pretty close to being true.

3: Strategize Your Withdrawals

woman with piggy bank, to illustrate retirement tips for seniors

If you have money in an account, there’s a right way and a wrong way to get it out. Unfortunately for those of us who prefer a simple answer, the right way to withdraw your money depends on the type of account it is in, your age, and a number of other factors.

Unless you want to end up giving a large percentage of the money you withdraw to Uncle Sam, it’s important to look at your options and figure out how each one affects your taxes. Only by determining the best way to withdraw money will you be able to make the most of the savings you’ve worked so hard for all these years.

4: Choose Between Medicare and Medicare Advantage

medicare sign, to illustrate retirement tips for seniors

Upon turning 65, seniors have the option to enroll in Medicare or Medicare Advantage. While Medicare is the government-run program that has been around for more than 50 years, Medicare Advantage is an alternative that is run by private insurers.

Each of these plans has advantages and disadvantages. For example, Medicare is accepted by more than 90% of doctors, so you probably won’t have to switch physicians if you go with Medicare. Medicare Advantage, however, offers more options as to what types of plans you are allowed, including all-encompassing plans that you won’t find with Medicare.

Which one of these options is best for you is something you will have to look at yourself to decide. However, choosing between Medicare and Medicare Advantage is an important part of the retirement process that should not be ignored.

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  • Phil_Town_Rule_One_Investing_Profile_Image_230

    About Phil Town:

    Phil Town is the founder of Rule One Investing, a hedge fund manager, a two-time New York Times best-selling author, an ex-Grand Canyon river guide, and a former lieutenant in the U.S. Army Special Forces. He and his wife, Melissa, share a passion for horses, polo and eventing. Phil’s goal is to help you learn how to invest and achieve financial independence.

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    1. took Phil’s course, loved it! Came home and was lost. Its been a month, I think about it every day but feel stuck…

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