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How to Prepare Your Finances for Senior Living

December 5, 2014

Saving for your senior living and health care needs now can help you live the most comfortable, healthiest, and happiest life you can after retirement. Although it is important to start saving for your future as soon as possible, it is never too late to begin. Here are some habits to work into your financial planning to boost your savings for these post-retirement needs. Since every person’s situation is unique, you should always check with your financial advisor before making any decisions.

Find Ways to Save Money

Become closely acquainted with your monthly spending. Make a list of all the things your money goes toward such as utility bills, gas, food, and loans. For each of the expenses you have written down, list all the ways you can think of to cut back spending. 

For instance, look into various car insurance discounts you may qualify for. Alternatively, depending on your credit standing, you may be able to refinance your home for a much lower mortgage interest rate. You can also make cutbacks such as packing a work lunch instead of eating out daily. 

By making reasonable changes to your monthly expenses, you can end up saving hundreds of dollars monthly that can be put away for retirement.

Set Goals and a Budget

As soon as possible, calculate how much money you will need once you are retired. Consider the cost of retirement homes, personal care facilities, and nursing care in your area. Knowing this will help you to set the saving and investing goals you need in order to retire comfortably and have peace of mind in the meantime. 

Between the money-saving ideas you came up with and your new goals, you will be able to devise a strong budget. Just like you will need to factor in expenses such as utilities, groceries, and clothing, you will need to include a set amount of money that you put away to save or invest for senior housing and care. 

Contribute to a 401(k)

If your workplace offers a traditional 401(k) plan, start contributing as much as you can every month. Because these plans offer compound interest, and they allow you to contribute money before taxes, they are one of the best ways to save money for senior living facilities and other post-retirement needs. Many employers offer to match the amount of money you put into a 401(k); if this is the case for you, take full advantage. 

Consider Postponing Social Security

A person will begin to qualify for social security benefits at the age of 62. Before factoring social security benefits into your retirement plan, know that benefits will increase for every year a person postpones receiving them before age seventy.

For example, " Person A" started receiving social security checks at age 62 and is receiving 18,000 dollars annually. "Person B" waited until age 70 and is receiving 31,680 dollars every year. In 30 years, Person A will have accumulated 540,000 dollars. However, Person B will have gained 620,000 dollars over only 20 years. 

No matter what your age, saving now can help you prepare for your future way of life. If you or someone you know is approaching retirement, consider the advantages of a worry-free lifestyle offered by the retirement living facilities of Concordia Lutheran Ministries. At Concordia, our independent living locations are designed with your best interests in mind, providing you with affordable, top-quality services to help you lead the fulfilling lifestyle you have worked so hard to achieve. Call us today to arrange a personal tour of any one of our Concordia Retirement Living locations, and learn why choosing Concordia may be the best decision you’ve ever made.

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