If you are tiptoeing forward retirement, there are a few factors to take into account. Even if it is not an early retirement, you can’t stop worrying about how to manage household expenses in your sunset years. In fact, you need to start planning for retirement during your heydays. And if you are seeking an early release from 9 5 duty hours, it is obvious that more important considerations need your attention. So, have a tour of the following details before deciding on a permanent break up with your workstation.
Social security benefits can be claimed only when you attain the age of 62
It means that if you are taking retirement at the age of 58, you need to wait four long years to get the benefits of social security. If there is a little chance of getting generous dollops of pension from your employer or you have no other sources for financial support, early retirement will be an unwise decision. In fact, you should not call it a day till that magic number, 62 is reached.
Retiring before 66? You can’t get full social security retirement benefits
Retiring before 66 means you won’t earn a decent income from the Social Security Administration. The closer you reach the age, more will be your benefits in terms of what you will receive. An incremental process will apply to your paycheck value. A certain percentage of monetary benefits will be handed over to you in case of early retirement. Full percentage can only be availed only if you hang up your boots at 66. You can use a retirement age and income calculator (there are plenty of them online) to get an accurate snapshot of how much security benefit to gain at a certain period.
Consider your health care
Some health care plans don’t kick in till you are turning 65. What if you are a few milestones’ away from 65 and planning a retirement? You must know the health care options to get the most of medical care plan. Sometimes, an employee’s pension plan comes in a package with insurance coverage. It will be the best health care option for you. However, if there is no such packaging or the conjugal plan is expensive or is valid only for a short term period, you need to think other ways around.
You can qualify for group health insurance as a paying member of the AARP or American Association Retired Persons, If you are retiring within 18 months of reaching 65th birthday and not getting a retirement health care package from your employer, paying for COBRA benefits sounds a wise consideration. Expensive it is although, still this will be much better than worrying about where to get the funds from if you fall sick before receiving full benefits of medicare plans.
Never lose focus from inflation
How much to gain if you retire now? Will that figure support you through another 20 years? Even the cheap things may be beyond your reach by that time. Whether it is an early retirement or not, you should calculate the living cost after a couple of decades if the same standard of lifestyle is to be maintained.
You are never too early to make a retirement plan. In fact, it is much a better idea if you start thinking about that when you are 25 or in early thirty. Won’t it be better to plan beforehand rather than losing your sleep over a tragic twilight saga in post retirement years?