Through careful deliberation, many Americans have figured out their retirement planning requirements. But a comfortable retirement needs more than just creation of a financial strategy. It also means sticking to the plan you have developed.
Of course, there are some events beyond our control, events which can disrupt a retirement plan. Stock market downturns, costly unforeseen situations, and medical emergencies are a handful of such occurrences. There are some ways to mitigate the effects of these situations, but there are other mistakes which can prove detrimental to retirement security.
Here’s a look at some pitfalls which can put a retirement plan on the line – and which we recommend you take measures to avoid. Read More
It’s not unusual for retirees to have multiple sources of income. According to the Social Security Administration, people age 65 and older receive a majority of their income from four sources. These source-points cover a wide range of income needs, from monthly living costs to healthcare spending and other retirement expenses.
If you’re in or near the “retirement red zone” (a period of 10 years before retirement and the first 10 years in retirement), now is a critical time. Decisions made now – and decisions which are neglected – will have a significant impact on the rest of a retirement lifetime, no matter how long it lasts. It’s a stage at which to figure out how you will pay for all of your retirement years.
With that said, here’s a look at how people age 65 and older are paying for retirement, and some ways to maximize retirement income. Read More
Do you have a dependable level of income for retirement? According to a new study, many seniors aren’t generating the retirement income they need. BankRate.com reports seniors in 47 states and the District of Columbia aren’t replacing enough of the income they earned in their working years.
The study found that at best, seniors are living off 60% of the income they had in their pre-retirement years. Financial experts believe retirees need at least 70% of their pre-retirement income. BankRate.com reports the national average to be 60.27%. Read More
You’ve worked hard for many years. Upon retirement, most people would like to live on their own terms. Maintaining a comfortable lifestyle requires you to take the proper steps to secure it. That includes avoiding common errors which could put your retirement finances at jeopardy.
With precautions in order, retirees will be more prepared to enjoy a secure – and hopefully financially confident – future. Having said that, let’s cover a few pitfalls which could do a number on your financial security. Read More
According to a survey from the Employee Benefit Research Institute, just 21% of American workers are “very confident” they’ll have enough money for retirement. After many years of hard work, most people would like a comfortable retirement lifestyle. But this doesn’t just come together by itself.
Financial independence in retirement takes diligence, and it begins with creating a suitable retirement income plan. Then once you have this “retirement roadmap,” it’s a matter of sticking to it. Of course that involves taking action when you need to, like filing for Social Security at the right time or signing up for Medicare on deadline.
There are a number of costly mistakes which could greatly impact your retirement. These errors could mean higher unnecessary costs or lowering your standard of living down the road, so it’s important to be aware of these potential pitfalls. Let’s cover these retirement risks in detail. Read More
Last week we discussed the concept of “risk capacity” and its role in retirement financial security. Aside from retirement asset allocation, another part of income planning is accounting for expenses. Living expenses, long-term care costs, and healthcare expenses remain three primary retirement cost drivers. It’s more important than ever to plan ahead and to have a strategic combination of volatile and conservative financial vehicles to meet these needs.
Just healthcare needs alone can impose a significant cost burden on your retirement lifestyle. In fact, research firm HealthView Services continues to report they’re one of the fastest-growing segments of retirement spending. Ensuring they aren’t neglected is a critical step. Otherwise, they can be financially draining and greatly impact your standard of living in retirement.
What’s Going on with Healthcare in 2025?
In its latest reports, HealthView Services offers updated projections for 2025:
In 2024-2025, retirement healthcare costs are estimated to have risen around 7.5%.
Healthcare inflation continues to widen the financial gap—someone retiring today may have to pay $45,000 more than someone who retired just five years ago.
Healthcare inflation is projected to average around 5.5% annually over the next 20 years.
Supplemental insurance premiums remain age-based, and some retirees could see increases of 4.5% or more.
This could translate into some retirees experiencing combined annual inflation near or above 10%.
New policy shifts and ongoing changes to Medicare are also placing more of the cost burden on retirees. In 2025:
The Medicare Part B premium has increased to $185/month.
Changes to Medigap Plan F that began in 2020 continue to affect coverage and costs.
There have been modest cost-of-living adjustments, but many retirees still struggle to keep pace with rising healthcare costs.
Lifetime Healthcare Spending and Social Security Impact
The financial outlook is sobering:
A healthy couple aged 65 retiring in 2025 is projected to spend approximately $392,000 on healthcare premiums (Medicare Parts B, D, and supplemental insurance).
Including out-of-pocket costs—like deductibles, hearing, vision, dental, and copays—total expenses could reach $590,000.
In future dollars, those costs exceed $800,000.
For a 66-year-old couple, approximately 65% of their combined Social Security benefits may be needed to cover total healthcare expenses.
For younger generations, the burden is projected to be higher. A 55-year-old couple could need 90% of their benefits, and a 45-year-old couple may need over 115%.
Incorporating Healthcare Costs into Income Planning
With rising healthcare costs, income replacement alone may not suffice. That’s why it’s essential to plan with:
A realistic time horizon and proper asset allocation.
A strategic blend of growth-oriented and conservative vehicles.
Risk management to mitigate losses during market downturns—critical during early retirement years.
For example, heavy reliance on volatile investments like stocks could backfire during market corrections, impacting your ability to fund healthcare expenses or maintain your lifestyle.
Next Steps
For those looking to secure their future:
Consider annuities or other financial products that offer guaranteed lifetime income and downside protection.
Evaluate your Medicare and supplemental coverage annually to stay current and minimize out-of-pocket expenses.
Use tools like HSAs (if eligible) during your working years to build a tax-advantaged reserve for medical costs.
If you’re ready to take action, SafeMoney.com offers personal guidance to help you build a tailored retirement income plan. Find a licensed advisor here or call 877.476.9723 to explore your options.
🧑💼Authored by Brent Meyer, founder and president of SafeMoney.com, with over 20 years of experience in retirement planning and annuities.
Last week we discussed the value of having a guaranteed retirement income source. Annuities offer some strong advantages with their contractual guarantees. But they are only one part of the financial picture.
Overall, a portfolio could have many holdings: stocks, bonds, mutual funds, annuities, CDs, or even other financial instruments.
This brings up the question of portfolio allocation. Is there a paradigm which you should follow?
Ultimately, we would say it varies among individuals. Your portfolio strategy should be a good fit for your current situation, needs, goals, risk tolerance, and risk capacity.
Of course there are some well-known general rules of thumb for starting discussion, like the Rule of 100 for portfolio diversification.
As you get closer to the life stage of distribution — or where you are living off your retirement savings — risk tolerance and risk capacity become even more important. But just what are these risk-related metrics? Read More
Proactive planning is a critical step for a secure retirement. But just how prepared are American households for their retirement years? Of course it’s important to recognize all households will have different retirement needs. People vary in their life circumstances and objectives, and as a result, their financial circumstances and requirements will also vary.
Some couples may require a seven-figure nest egg to feel secure. Others are confident their Social Security benefits will be suitable for their future needs. Given how Americans have such a wide-ranging outlook on finances in retirement, how people interpret statistics such as average American household retirement savings will vary. What may be the start of a looming crisis for some may be a minor challenge for others. Read More
In the past, we’ve discussed ways to create a meaningful retirement. After many years of hard work, people want to enjoy their retirement years. It’s important for this period to be enrichening, but taking steps to ensure a secure future is also paramount.
Many baby boomers are couples. Oftentimes household duties and responsibilities are divvied up among partners. One handles the finances, and the other may hold responsibility for other areas of planning. Daily chores such as cooking or cleaning the kitchen are likely to be split duties.
According to U.S. Census Bureau data, women live an average four years longer than men do. If one partner deals with household finances and passes away one day, it can lead the other with quite the conundrum. To avoid this situation, people should take action now. Here are a few steps to further enjoy a more secure retirement – and to ensure the future is addressed for your partner. Read More
In the past, we’ve looked at retirement planning strategies for specific populations, like self-employed Americans or women. But what if someone is part of the segment of Americans who aren’t that well-prepared for retirement?
According to a survey conducted by BankRate.com, 36% of surveyed adults say they didn’t have a penny saved for retirement. Around 25% of the people aged 50-64 in the survey reported they had yet to start their retirement savings. These findings are consistent with data found in previous surveys. In fact, previous data shows there’s a wide gap between Americans’ retirement expectations and what they’re actually prepared for.
A big part of it is because many American households live paycheck to paycheck. So what steps can you implement to catch up on retirement savings? Read on for some helpful tips. Read More
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