Many people look forward to the rest and relaxation of retirement; others can’t wait for personal time to learn new skills or seek adventure. Whatever you have planned for the golden years, you’ll need a stable financial foundation to enjoy it. Whether you’re just approaching your senior years or well into them, good financial planning is never out of season.

Basic Guide to Pensions

Pension plans were once popular among many employers; today, pension plans are more likely for government employees and those who work within union structures. A pension is simply a type of retirement account that is maintained by the company you worked for. Upon retirement, you receive a fixed payout. Depending on how your pension is set up, you can opt to take a single large payment or receive an amount each month. The amount you receive is based on how long you worked for a company and how much you made while working there.

When a pension is available, you’re usually automatically enrolled. A financial firm typically manages the investment for your employer, making pensions a low-stress way to save for retirement. If you haven’t already retired, make sure you understand how your pension is vested before you decide to leave your job. In some cases, if you leave the job too early, you give up all or part of your pension payments.

Getting the Most From Your 401K

A 401K is not the same thing as a pension. Although the plans are usually offered through an employer, you must elect to take part in these benefits, and you might have some say in how your investment funds are handled. You are also partially responsible for funding your 401K account through pretax deductions from your paycheck. Some employers match contributions up to a certain percentage of your paycheck, which can help you build retirement savings faster.

Before retirement, if you take money out of your 401K, you pay tax penalties because that money wasn’t taxed to begin with. After retirement, you can take money out of your 401K at a certain rate without paying those penalties. You can begin drawing on your 401K balance for retirement needs at the age of 59.5. To best protect your financial stability in late life, you might want to avoid withdrawing from your 401K, even if you are 59.5, if you are still working and have a regular income.

Protecting Your Financial Interests

Most individuals of retirement age do live on fixed incomes, even if some are more fixed than others. Protecting your finances and your financial accounts is critical to ongoing stability and enjoyment in later years, and this is getting harder to do with the increasing need to use and manage money online and the constant evolution of clever scams and hacking schemes. The Consumer Financial Protection Bureau offers resources and training modules for seniors who want to protect financial interests.

Understanding End-of-Life Insurance Needs

After you’ve covered financial basics for your retirement needs, you might want to consider financial needs for end-of-life and beyond. Health insurance is a must for anyone in retirement, and you might want to consider long-term care insurance to cover any stays in nursing homes. Life insurance is also important, especially if it’s possible you might pass away and leave outstanding debts or obligations. Life insurance is also a good way to ensure your family isn’t left holding a bill for funeral or cremation costs if you haven’t already made arrangements with a provider such as Neptune Society to prepay for services.

End-of-life and retirement financial needs can be complex. Consider working with a professional adviser to determine how much savings you need to live comfortably in retirement and how you should manage funds post-retirement to get the most from your savings.


Published | Category: Cremation Planning for Caregivers.

Sarah Stasik is a full-time freelance writer with a background in healthcare revenue cycle management. She writes regularly on topics such as finance, healthcare, and technology. Items on her bucket list include writing a novel, visiting Yellowstone, and perfecting the art of homemade buttermilk biscuits.