Data derived from the U.S. Census Bureau and recently reported by the Population Reference Bureau, as of mid-2014, shows that the baby boomer generation stands at 76.4 million strong.
For those born between 1946 through 1961, many are now reaching traditional retirement age and although hesitant to fully retire are still expected to have a significant effect on Social Security, Medicare and Medicaid as retirement is being redefined.
The American Association of Retired People (AARP) estimates that 79 percent of all baby boomers plan on incorporating some form of employment into their retirement plans. At the golden age of 65, many boomers are simply deciding to continue working full-time while others are opting to work part-time or change career objectives. For those choosing traditional retirement, opportunities for volunteering or participating in community service are popular.
Recently, a U.S. News & World Report article addressed this growing quandary as many Boomers are coming face to face with their planned retirement date and are hesitant to quit their careers and opt to continue to grow their retirement funds.
It is also advisable for those caught in this Catch 22 to have already began the estate planning process as well as considering these helpful tips regarding retirement while still in the final stages of gainful employment.
Estate Planning 101
Schedule a consult with an experienced estate plan attorney to discuss either devising a Trust or Will, designate a reliable and trusted Power of Attorney, establish a Living Will, and explore Estate Tax Planning as an option to “gift” to reduce final estate taxes.
Stash the Cash
Although most Boomers believe that their income does not match their retirement planning needs, it is highly advisable to revisit your strategy and contribute the maximum amount to your retirement accounts. Consider increasing the amount of your paycheck contribution deductions significantly during the time leading up to your planned retirement date. Opting to stash some cash in a Roth IRA, taxes can be paid while employed and you can enjoy tax-free withdrawals during retirement.
Take Your Retirement Budget for a Trial Run
While still employed, take your retirement budget for a test drive by abiding by your monthly projected retirement budget. By doing so, you will be able to discover if your budget is successful when put to the test. If not, there is still adequate time to prepare while still employed and changing your projected retirement date.
Bring Your Financial Picture into Focus
The best advice is to simplify. By consolidating your financial accounts and perhaps by consolidating your investment portfolio you are decreasing your risk of financial mistakes and lowering time spent on managing more than one account. Just as you will need to meet with an experienced estate planning attorney, schedule a consult with your trusted financial advisor to discuss any tax related consequences.
It is suggested that these strategies should be set into motion at least up to one year prior to your targeted retirement date, so you can ease into the next stage of your life with confidence and financial security.
If you are planning to retire within the near future and have yet to meet with a qualified Wheaton estate planning attorney, the legal team of Stock, Carlson, Flynn & McGrath, LLC offers strategic estate planning tools to simplify your total retirement plan. Contact our offices today to schedule your initial consultation.