Retirement

How to Keep Yourself Fit for a Healthy Retirement

All the advances in medicine and technology have created a dramatic increase in life expectancy. People are living longer than ever, including much more years in retirement. We all hope for a happy and healthy retirement, but unfortunately, getting older comes with concerns over health.

Making an active effort to stay healthy will not only allow you to live longer but will increase your chances of having a more fulfilling and energetic retirement doing the things you love.

So how do you keep yourself fit for a healthy retirement? The best advice is to start planning for it today.

In this article, I will look at the problems related to physical, mental, and emotional health and find ways to improve each.

Find time for physical activity

Whether you are planning to retire in a few years or already retired, get moving.

We all know that exercising is important. Studies have consistently confirmed that regular exercise reduces your risk of heart disease, diabetes, stroke, and even slows down the development of dementia. So, if you want to have a healthy and active retirement, then find time for regular exercise.

Many experts argue over how much exercising is healthy. But everyone agrees that some moderate exercise is better than none. Whether it is aerobics, lifting weights and doing sit-ups, or practicing yoga and gardening, we should all get engaged in some moderate physical activity.

The important part is to find the activity you like so you will keep doing it regularly.

Do not wait until you retire or do not wait until your health starts to decline. Choose something you would enjoy and make it part of your daily routine.

Many books and YouTube videos can help you to do a workout from the comforts of your home.

15 Best Quick and Easy At-Home Workout Moves

Here is my favorite home workout on YouTube. It only takes me 30 minutes to follow the workout playlist any time I want.

Family Fitness – 30 Minutes Body Workout

If you prefer to exercise with other people, you can join a gym or take group fitness classes. But if you do not want to spend extra money on expensive personal trainers or gym membership, walking, running, or cycling outdoor will be more than enough to stay in good physical shape for years.

Explore your local walking and jogging trails. Those 30 minutes a day you need to spend walking can be done in a local park or greenway path. Leave your car at home and walk or bike to the local store, bank, or post office. Gardening or decluttering are also easy ways to keep you active and fit.

Have a healthy diet

As you age you are more likely to have problems with health linked to nutrition. That is why a healthy diet is more important than ever.

Eating healthy is similar to exercising every day. And it works better if you plan for it. Plan your meals so you will not end up snacking up on ice cream before dinner because you are hungry.

If you want to eat a healthy diet avoid too many saturated fats in meat and dairy. Healthy people usually restrict the amount of sugar and salt in their diets, and they drink lots of water and tea.

According to various studies, a diet rich in fruits and vegetables is linked to a reduced risk of obesity, diabetes, and cancer. So instead of eating fast food, you should choose to eat fresh food. For people over age 65, it is recommended to have five or more servings of fruits and vegetables every day.

For me, the Mediterranean diet works as a great inspiration. People in the Mediterranean region live longer because they follow a healthy diet rich in whole grains, vegetables, fruits, and low-fat dairy products. Their diet is low on animal products, and they prefer to cook fresh fish.

You need to make sure that you are always working on how to improve your diet by choosing foods that are good for you and cutting down on packaged food. Do not forget to shop smart and always read food labels to avoid foods high in cholesterol and saturated fat.

veggies and fish - healthy diet for retirement

I try to eat healthy every day and plan all our meals. I like to have a healthy breakfast – orange juice, oatmeal, fruit, and green tea. I try to eat less at dinner because I watch my calories and do not want to gain extra weight. I prefer to eat meat or fish during lunch. And I serve all our meals with at least one green vegetable or salad.

And the main thing, I try to go easy on sugar (chocolate and ice cream are my weakness!) and drink plenty of water with lemon.

Learn new things

Keeping yourself fit in retirement is not only related to physical activity. In general, being fit means a combination of different factors including physical fitness and mental health. Staying sharp mentally is as crucial as staying physically fit.

When you are engaged in physical activities you focus on your muscle strength training. The same kind of training should go for brain activity. To stay mentally fit you need to challenge your brain with various exercises.

One of the best ways to keep your mind young and active is by learning new things.

Here is a list of ideas:

Learn how to play a musical instrument
Start (or join) a book club
Learn how to paint
Take a pottery class
Learn how to be a photographer
Take a cooking or baking class
Write a poem
Write and publish an e-book
Learn new digital skills – open an Instagram or Twitter account.

I believe that keeping our minds sharp is an important part of prolonging the time we can enjoy in retirement.

Monitor your health

Many health issues are age-related.

Our body gets weaker as we age. Many people will experience aging issues such as heart disease, arthritis, diabetes, dementia, osteoporosis, and more. That is why regular medical check-ups are a must.

You should visit your doctor regularly and do not skip any recommended health screenings and tests. If you are a woman, you need regular tests for breast and cervical cancers. If you are a man, your doctor should help you decide about a prostate cancer test.

Keep an eye on your blood pressure and cholesterol level to avoid a heart attack or stroke.

Maintain an active social life

People who have plenty of friends and enjoy a close relationship with their families, typically live longer than people who are lonely.

When you retire, you do not just leave your job, you enter a new stage in life.

Leaving the workforce will reduce your social interaction with colleagues. Friends and neighbors might retire and move away. Death can take a spouse or close friend. Those are all sad life events because loneliness is linked to poor health and early death.

We all know that having a strong social support system helps us deal with stress.

It is important to stay involved and engaged in life, so you do not feel lonely. Being engaged in a community gives people a sense of purpose, security, and connection. It is important to have a reason to get up every morning, go out, and do things.

Find new purpose in life

If you are ready to leave the working world, think about how you will spend the 40 + hours a week you spent previously at your job.

The reality is that you may feel ready to retire, but on the other hand, you may feel nervous and doubtful.

What are you going to do with all that free time? One of the best things you can do is create a plan for your retirement.

You need to decide what will be important in your new life and how are you going to spend your days and weeks. The minute you say goodbye to coworkers you need to know what is next for you.

It is not a secret that when you feel like your life has a purpose and meaning, you will experience less stress. And with less stress comes fewer negative health effects.

Having a purpose in life makes people stay more physically active and more willing to take care of themselves.

Finding Your Purpose in Life in Retirement

Find hobbies to fill your days

I think everyone had some interests in life before they were forced to put them on a shelf during their working years. We spend our lives doing things that we have to do – career, kids, family. But retirement gives us a new opportunity to start over again.

Many retirees struggle to feel useful after they stop working which can negatively affect their health. Instead of being depressed and unhappy, refocus your energy on learning something new and more interesting than your previous job.

I believe that desire to travel the world is a big factor for people wanted to retire. Travel is important at any time in life. But travel in retirement gives you a new opportunity to explore the world, learn a new language, and use your social and communication skills.

Another big factor is a desire to complete a bucket list. Creating a bucket list is a helpful tool to set up your retirement goals or have a list of things you want to complete at least once in your life.

15 Ideas on What to Do in Retirement

Work on your relationships

Retirement can be a challenging time for relationships. When you stop working you will leave most of your friends at work behind. Sadly, many will disappear from your everyday life the day you leave.

two women on a bench - friendship in retirement

Growing older could be lonely unless you have support, love, and even friendship from your family.

Do you have a good relationship with your spouse if you are married? Do you stay connected to your children and their families? Do you spend enough time with your grandchildren?

There are many things to do together as a family. Go to the game or concert with your kids and grandkids. Consider a family vacation together. Spend all holidays and other celebration times together.

Do you stay connected with other parts of your family like your brothers or sisters? What effort do you make to stay in touch with them?

Unfortunately, many of us spend more time on Facebook, Instagram, or Twitter to stay informed and connected with former classmates or colleagues because they post often rather than spend time with people who are important to us.

I recently read that one of the greatest regrets of people who are getting closer to the end of their lives is that they didn’t spend enough time with their loved ones.

Life is short! Make sure that you spend enough time with the most important people in your life.

Takeaway

Taking care of yourself and making your physical, mental, and emotional health a top priority in retirement is the best gift you can give to yourself and those you love.

How do you keep yourself fit and healthy? Share your ideas in the comments below.

If you enjoyed reading, share this post so that others can find it, too!

5 Common Mistakes to Avoid When Choosing a Place to Retire

by Maggie Leave a Comment

old town-bridge-choosing a place to retire

The best thing about retirement that finally you can live anywhere you want. You no longer need to live closer to where your kids go to school or your work. Instead, you can move to a place with beautiful views, a better climate, a lower cost of living, or just a place you were dreaming about.

However, deciding on where to retire can be a difficult task. It will take a lot of time and effort. Unfortunately, one of the biggest mistakes people make when they choose a place to live in retirement.

You need to envision it, set up the priorities, do the research, make a list of areas, and then visit several places before you finally decide where to move in. Besides the financial issues such as cost of living and taxes, you need to consider the weather, amenities, environment, and how close you want to live to your family.

Planning to move in retirement can be exciting and stressful. However, some common mistakes can ruin even the most carefully planned retirement.

To help you make smart decisions, I came up with a list of 5 Common mistakes to avoid:

1. Not visiting enough places before deciding where you want to live.

Have you thought about your retirement priorities?

Do you like to live closer to the beach, golf course or near the mountains?
Do you want to move into an active adult community, a small town, or prefer rural areas?
Have you discussed your plans with your spouse or partner?

Every retirement website recommends doing detailed research before you commit to one place. The internet has lots of information on retirement communities, places to retire, and the cost of living there. It is a good idea to start planning early before you retire so you can avoid the costly mistake of moving around until you find the place you really like.

Start with creating a checklist of your priorities because it would help you narrow down the number of places you want to move in.

It will be smart to visit the places on your wish list if you are still working. Internet research is great, but often you need to see a place with your own eyes. Because while everything looks amazing online, a half an hour drive to the nearest grocery store can ruin the comfort of your daily life and would become a huge inconvenience.

My favorite go-to website is TopRetirements.com

This website provides you with tons of information for the best retirement communities, active adult communities, and places to retire. If you are at the beginning of your research, start with this website to get some ideas and then decide if you are ready for a visit.

When you travel, make sure to explore the town you like as a potential “best place to retire”. Drive or walk around and decide what you like or dislike about the neighborhoods. Take a tour through any active adult communities if there are any in the area.

It is always a good idea to talk to locals and ask questions about their life there. If you are planning to visit several neighborhoods do not forget to take notes so you can refer to them later. Recently I read that some people even prepare pros and cons spreadsheet while visiting retirement communities.

When you visit a place, do not spend all your time near the hotel. Walk around, visit neighborhoods to get a sense of people. For me, the ideal place to move in would be the place with:

Walkable streets
Close to shopping areas
Close to parks or green spaces
Short drive to the beach
Access to public transportation
Proximity to medical facilities

Another tip for avoiding common mistakes is to visit your favorite place during different seasons. Weather is an important factor, and you want to make sure that you like your new home in all seasons.

lake-snow-trees - choosing a place to retire

I do not like hot and humid weather, so even we want to move to Florida I cannot stay there during the summer. Because of that, we would need to have another place where we can escape the hottest months of the year.

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2. Not renting before buying a retirement home.

I am sure you heard the stories about retirees who regret that they did not live in the area before they bought their retirement home. It is so easy to get excited about the community or new development that seems to meet your dreams. But once you settled down it might be too late to realize that you miss the comfort and amenities of your old life.

It is hard to really know a place before committing to that area unless you rent it first. But if you do not want to rent a place before you buy it, make multiple visits during different seasons to get a feel of this area you will call home for a long time.

Renting a home in the neighborhood you like can help you live like a local. Also, renting make sense if you are considering a move to a new lifestyle. In retirement, we are planning to move from the suburbs to a city. It will be a huge change in lifestyle for us, so we want to test it out for a few years by renting an apartment and see if we like it there.

Renting can also be a temporary step if you are not financially ready to buy a house. More retirees are renting these days because they do not want to be in charge of maintenance or yard care.

Buying a home at any stage of life is a major purchase and not a quick decision. It costs a lot to move to a new home, so you have to plan wisely.

It is important to remember that your retirement life can last for 20 or 30 years. Therefore, you need to find a home with an understanding of your long-term needs. It is great If you healthy right now, but it might change in the future. If one of the spouses gets sick, you will want to live closer to the medical center for regular appointments rather than travel for hours to see a doctor.

The best advice is to rent before you buy because you will get fewer surprises in the future. Otherwise, it can be a costly mistake.

3. Moved to be closer to family.

Many people move to be closer to their children and grandchildren when they retire. In many cases, it is a great idea.

But the situation might reverse, and you will be chasing your children around the country if they choose to relocate. You do not want to be in situation when you move to the area and then find out that your family will be moving away.

grandma with granddaughter baking - moving closer to family in retirement

4. Not doing your due diligence before moving to a new place:

Moved to the wrong environment.

That is a common mistake for many retirees. That is why you need to make sure that the location meets all your needs before you move in.

Everyone knows that staying socially active makes you happier and healthier in retirement. But where are you going to meet new friends? Does a new place have social events, clubs, or gathering places? Is it close to a coffee shop, pool, library, or movie theater?

We live on the east coast. Here everything is close enough if we want to drive for a few hours to get to another state or town. But if we move to Texas or Arizona, I will miss the variety of New England scenery and proximity to a familiar environment. Everything will be far away if we want to have a change of scenery.

If you are planning to move to one of many retirement communities, make sure that it will be a good fit for you. I would recommend renting a unit and spend a week there. Go to the restaurant where everyone eats and see if you like the food and ambiance. Go to the games room, swim in the pool, and talk to residents about life in the community.

The best advice is to find a place that matches your lifestyle when choosing a place to retire. Hence, do not move to a rural area if you love going to museums and theaters.

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No access to good healthcare.

Keep in mind that access to good healthcare and medical facilities is a must when looking for a place to retire. When you are in your 60s and 70s, you are still active and healthy and probably need only routine doctor visits.

But as you grow older, you will need access to retirement facilities, home care providers, and transportation for people with disabilities. And you do not want to move to another place in search of better healthcare in your late 80s.

5. Not considering the design of your retirement home.

That is a common mistake for many retirees when they buy for today and not for tomorrow. You are healthy and active today, but unfortunately, your mobility will decline with age. That is why you need to consider the design of your home with the idea of how it might change in the future.

Everybody loves living in a new two-floor modern-designed home. But what happens if one of the spouses will lose mobility and will be in a wheelchair? How will you go around the stairs? It will be stressful to start looking for a single-level house while trying to sell and move out of your brand-new home.

Have you thought about if your house is accessible for your future needs?

You might not need it right now, but life can change very quickly in 10 or 15 years. It will add a lot of stress and money if you need to renovate your home later to fit your physical abilities.

The important thing to remember that if you are moving to a new place make sure that your house is a comfortable place to age. In the end, it can be expensive and difficult to remodel a place with lots of stairs, a second-floor master bedroom, tall kitchen counters, narrow doorways, and more.

Final Words

Choosing a place to retire may be one of the biggest decisions you will ever make. Hence, do not make it in a rush. Take your time and choose wisely.

But do not be discouraged by the amount of work you have to put in upfront. After all, you will benefit greatly by living and enjoying the retirement of your dreams.

What are your top retirement mistakes to avoid?

Share this article if it helped you!

Checklist for Retirement Planning in Your 60s

by Maggie Leave a Comment

woman making notes at table outdoor - retirement planning in 60s

When you are in your 60’s you know that your retirement is around the corner. Getting closer to the retirement date can be both exciting and stressful. Everyone wants to have a happy and comfortable retirement.

But when you have a limited number of remaining years you need to take time to understand your retirement picture. You do not want to be one of those people who want to retire, but when that day finally arrives, they just let it happen. You want to be smart and invest time in planning and preparing for a big day. Before you take the plunge make sure that you are ready!

Here is a checklist of helpful steps to take for people in their 60s who plan to retire in the next 5 to 7 years:

1). Understand your retirement lifestyle.

Before talking about finances, I want you to answer the following questions:

Where do I want to live in retirement?
What do I want to do in retirement?

Answering these questions is important because it will determine the cost of your retirement. Most people already have a vision of their next phase of life. But not everyone goes into the details of planning it.

Think about retirement in stages. Your early years of retirement are going to be the most active. Then you will settle down and face a slowdown in your activities. Your retirement lifestyle will determine the cost of your retirement.

For example, I love to travel and have a long bucket list of places I want to see and countries to visit. plan on traveling the world when we retire. Once we retire, we are planning to spend half a year abroad traveling. That will take a significant amount of money to cover our travel expenses. But we already have determined a retirement budget for the first 5 years of our travels. Eventually, we will slow down and start spending more time at home. Going on one or two big trips a year will be all we can afford to pay for the cost of traveling.

Being in your 60s is an ideal time to look at your retirement plans. You are close enough to retirement to have a realistic idea of how you want to spend your golden years.

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2). Finalize your income and expenses.

Once you have a picture of your retirement lifestyle you need to finalize your financial assets and see if you have enough money saved to pay for this life.

Income

Financial experts suggest that you need about 80 percent of your pre-retirement income to maintain the same standard of living in retirement. Suppose my current annual income is $60,000. Multiply that number by 80 percent ($60,000 X 0.8 = $48,000). So, I will need around $48,000 in retirement to live the way I do today.

This number is a good rule of thumb if you do not plan on making any major budget changes when retire. However, not all retirees spend less in retirement. And if I have expensive hobbies like traveling, I will need a higher number.

Now when you are close to retirement, the rule of thumb “80 percent of pre-retirement income” should be replaced with real numbers. This number should include your daily living expenses and the money you want to spend on hobbies and activities.

Sources of retirement income:

When you are working you probably have a single employer and a single source of income – your salary. In retirement, everyone has different sources of income. As a retiree, you receive income from multiple sources:

Guaranteed income:

Social Security
Pension
Annuity – a guaranteed income you must purchase yourself

Other sources of income:

Part-time job
Rental income
Business
Dividends

Income from your retirement funds:

Tax-deferred accounts – 401(k), IRA
Tax-free – Roth IRA, Roth 401(k)
Taxable investment accounts
Taxable bank checking and savings accounts

While working, you receive a paycheck regularly – probably every two weeks. When you retire, you might receive income monthly, quarterly, annually, and even irregularly. Getting a clear picture of your retirement income should help to make sure that you have enough money to cover all your living expenses.

Expenses

I know nobody likes to read about budgeting. But the best advice is to create an estimated retirement budget based on your current and future expenses. You might have a general idea of what you spend now. But you will be better prepared if you have a clear picture of your expenses now and how that might change in the future.

When you retire you do not need a lot of things that you did when you were working. The costs of commute, take-out lunches, and business clothes will go down. But you will start spending more money on travel, hobbies, and activities. And your medical expenses will increase with time.

lake-boats-flowers-retirement planning and retirement expenses

It is important to include big-ticket expenses into the retirement budget as well. Paying for a wedding, buying a new car or a lake house will require a significant amount of money withdrawn from your retirement funds.

If you do not know how to create a retirement budget or organize your finances for retirement, I recommend reading my articles:

3). Minimize your debt.

When you are in your 60s make it a goal to pay off your credit card debt, student loans, car loans, home equity loans, and any personal loans before your retirement date. Do everything you can to retire debt-free and even pay off your mortgage if possible.

When you stop working and start living on a fixed income you will need to stretch those retirement dollars as far as you can. How can you enjoy your retirement if you must spend a portion of your retirement income to make mortgage or debt payments each month?

Credit cards

If you are carrying a high-rate credit card debt you are putting a lot of pressure on your finances. There are two most popular debt payment strategies – the snowball strategy and the avalanche strategy.

The snowball strategy works by paying off the credit card with the smallest balance and then working your way up until all credit card debt is settled. The avalanche strategy allows you to pay off your highest interest rate debt first and then work it down. I recommend focusing on your highest-interest debt first because the longer it takes you to pay it off, the more money you will pay towards interest.

And if you can help it, do not add any more debt to the pile while paying off old debts.

Over the years Roman and I have accumulated $170,000 in debt – car loans, student loans, construction loans, and medical expenses. It took us 21 years (from 1999 to 2020) to pay them off. The only debt we have left is the mortgage. We try to increase our payments towards the principal. Recently, we refinanced but I do not think we will finish paying it off in full before we retire.

Mortgage

When you are in your 60s, one of the smartest things you can do is to pay off your mortgage before you retire. A mortgage-free retirement is usually best because you can spend more money on the fun stuff. Retirees often have to withdraw money from their retirement funds to cover their mortgage payments.

Unfortunately, those withdrawals typically trigger more taxes. That is why it is better to pay down your mortgage while you are still working, so you can keep your housing expenses low.

Look at your mortgage balance and try to figure out how much extra you can put toward your mortgage each month. Those extra payments can reduce your principal balance significantly. Also, instead of sticking with the traditional monthly payments, you can start making bi-weekly mortgage payments. In addition to that look into refinancing your mortgage to get a lower rate and to reduce your monthly payments.

However, for many people paying off the house is not financially possible. When a payoff is not feasible, you should reduce mortgage debt by refinancing it. We recently refinanced our mortgage with AmeriSave Mortgage Corporation at 2.5 percent. It helps to lower our monthly payments and save us $500 a month.

When you are in your 60s, getting out of debt should be your priority. At this age, you have to make the most of your remaining years in the workforce to increase your retirement savings within the next 5 to 7 years.

I recommend reading my article:

How to Pay Off Debt Before You Retire

4). Maximize your retirement savings.

When you are only a few years away from retirement, being short on retirement savings can be problematic. The best option is to start spending less so you can put more money into your retirement savings.

Whenever possible, increase your retirement contributions up to the maximum allowed in retirement plans such as 401(k), IRA, and Roth IRA.

The 2021 contribution limits are:

$19,500 for 401(k) retirement plans. And if you are age 50 or older, the catch-up contribution is an additional $6,500. So, you can save a total of $26,000.
$6,000 combined contribution for traditional IRA and Roth IRA. And the catch-up contribution for people age 50 or older is $1,000. So, you can save up to $7,000 with your pre-tax money (IRA) and after-tax money (Roth IRA).

When you are getting closer to retirement, maximizing your traditional 401(k) and IRA accounts is important but not always enough. While you are still working you can make it a priority to save even more money in your Roth IRA account, emergency fund, and perhaps taxable investment funds if possible.

Another way to increase your retirement savings is to work longer. The goal is to make the most of your working years. You need to maximize the time you have left. Earning an income for a few more years could improve your financial security in retirement.

I am sure you may not like to hear this, but the fastest way to save more money for retirement is to cut your expenses. If you start practicing how to curb your spending and live on less money today, it will make your life easier in retirement.

Many people in their 60s enjoy the life of empty nesters. When the kids are gone, they start spending more on luxuries. It is easy to get used to a luxurious lifestyle, start spending more and saving less. However, it will be tricky to save money and even to retire if you let your spending get out of control. After all, the less you spend the more you save.

5). What is your retirement income plan?

After decades of earning and saving money for retirement, you need to shift gears and start spending what you have saved. And being just a few years away from retirement date is the best time to find out how much income you can pull from your nest egg.

There are three sources of your retirement income:

Social Security
Pension income (if you are the lucky one)
Income from your investments and savings

When you stop working you need money to pay for your retirement expenses. After you retire, you will receive Social Security payments. But that will be only a portion of your retirement income. You will start receiving payouts from your retirement savings.

But you will have to figure out a strategy of how to withdraw money from your retirement funds. This withdrawal strategy should give you the income you need from your first month of retirement through your 80s or 90s.

The “4% rule” is a well-known rule of thumb and a good starting point. According to this rule, you can withdraw 4% of your account balance.

For example, if you have $500,000 saved in retirement funds you can withdraw 4% of that amount – $20,000 in the first year of your retirement. You can adjust that number every year for inflation but following this rule should help you not to run out of money for at least 30 years.

Though, you have to be aware that there are a few problems associated with following this rule:

Return risk – the risk of earning smaller returns than it was in the past.
Longevity risk – the risk of living a long time and running out of money at the end of your life.
Series of return risks – the risk of a market downturn during your early withdrawal phase.

Even it is not perfect, the 4% rule is a good starting point you can adjust with time.

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6). Decide how to cover medical expenses.

You will become eligible for Medicare at the age of 65. If you plan to retire before age 65 you will need to find a separate plan to cover your medical expenses.

Your health insurance provided by your employer ends when you stop working. Even though your current employer promise to cover your health insurance in retirement does not mean they will not change their mind in the future or reduce coverage significantly. Thus, you will need to find and buy your health insurance coverage. Individual health insurance is expensive and could cost more than $1,000 a month. Make sure to shop around for the best prices.

Even being eligible for Medicare brings its own set of challenges because it does not cover all medical expenses. Medicare does not cover premiums, deductibles, co-pays for doctor visits, dental and vision care, long-term care, personal care, and other expenses. This means you need to include healthcare costs in your retirement budget.

7). Protect yourself and those you love.

Have you thought about how to protect yourself as you age and how to help your family care for you if you need it? When the time comes that you need assistance who will manage your finances, your medical care, and your regular day-to-day life? I understand that these are difficult topics to discuss. But it is a part of reality to grow old. And if you love your family you will plan for it, so your loved ones will not struggle and may have to scramble to care for you.

I write often in my articles about the cost of medical expenses in retirement. I want to remind my readers that healthcare is the second biggest expense in retirement after housing and you need to plan for it. Medicare is not free. It does not cover all your medical expenses and does not pay for long-term care.

Long-term care insurance is the most recommended way of planning for future expenses. It will cover nursing homes, assisted living facilities, and in-home care. It will help you not to be a financial burden on your family if that time comes. And you do not want to leave your husband or wife with nothing because the entire nest egg was used up taking care of you.

8). Think of tax strategies.

In retirement, we still need to pay taxes, but not all sources of income are taxed the same.

American dollars on a table - prepare tax strategy in your 60s

Withdrawals from tax-deferred accounts such as 401(k) plans and traditional IRAs will be taxed as an ordinary income. Withdrawals from Roth IRAs and Roth 401(k) plans will be tax-free. If you want to withdraw money from taxable investment accounts, you will have to pay capital gains taxes.

In addition to taxes, you need to remember about required minimum distributions (RMD). You will face this requirement when you reach the age of 72. By the US tax law, you are required to start taking withdrawals from your retirement accounts such as 401(k) and IRA (excluding Roth IRAs). The amount you must withdraw will be determined by the IRS. If you have more than one retirement account, you can withdraw money from each account or total RMD from just one account.

It is important to remember that your RMD withdrawals might push you into a higher tax bracket.

Think about what tax strategies will work for you the best. If it makes more sense, you can roll your assets into Roth IRA before you reach RMD age. Another option is to start taking withdrawals from your retirement accounts before RMD kicks in so you would not face the sudden jump in taxes.

9). Reallocate your investments.

The last few years have been volatile years for financial markets. Many people pulled money out of the stock market. When you are close to your retirement date is tempting to stay away from stocks to reduce the risk of losing money in your retirement funds.

But keep in mind that stocks provide growth. And investing in growth is important at this stage of life. If you retire at 65 and spend 20 to 30 years in retirement, you need to have enough growth to make your money last that long.

Put it on your checklist to review your asset allocation and make sure your portfolio is diversified and invested for growth. What I am suggesting is to have a balanced mix of stocks, bonds, mutual funds, and other assets that fits your retirement goals.

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Final Words

Your 60s is a decade full of transitions. Perhaps your kids are out of the house, and you are thinking about downsizing. Perhaps you would like to relocate to a warmer climate. Medicare will kick in at 65 and you may also find yourself ready to leave the full-time job that defined so much of your daily life. Somehow you have to navigate the various transitions in this new period of your life.

Regardless of how you plan the transition to retirement, your most precious asset at this stage of life is your attitude. How you envision your future is everything. A positive attitude will carry you forward into the future and your golden years.

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Finding Your Purpose in Life in Retirement

by Maggie 4 Comments

woman-laptop - finding purpose in life in retirement

One of the challenges of retirement is finding your sense of purpose in life.

While we are working, the responsibility and commitment of work give us a sense of purpose and meaning. When we retire, we look forward to leading a more relaxed lifestyle. But many people often miss the feeling of being valued in the workplace.

The important thing to remember that just because you have retired from work does not mean you are retiring from life. Retirement is a huge transition where you have to refocus your energy into something different than your career. Think about the new lifestyle you will be walking into as well as if you are prepared for it.

Purpose and Meaning

In the past several years I have been talking to retired friends and reading blog posts about what has given retirees purpose and meaning in retirement. And what I have learned that finding a new purpose in life is a major undertaking. It takes quite a long-time to find how to replace a work-related purpose with something new.

Most people believe that preparing for retirement is all about saving money and building wealth. This is true because money and financial independence are a huge part of a solid retirement plan. However, it is not the only one. Understanding your personality and creating a plan for what to do with yourself may be just as important as saving in your 401(k).

So how to find a new purpose in life? Think about how to refocus your life by writing down your interests and things you want to do in retirement.

Some people might find their purpose in doing meaningful work like being a volunteer while others might find that their purpose is to help family and friends. Some people find their purpose is going away on a spiritual journey or helping others on a similar path.

Think about who you want to be in retirement and ask yourself:

What special talents or interests do I have? Am I a creative type?
Do I have a dream that I want to pursue?
What do I want to achieve?
What skills I can use to benefit other people?
Do I like to work at something I am used to, or would I prefer to face new challenges?
What would I regret not doing if I die?

As you gather your thoughts answering those questions, you can begin to outline what your new purpose in life might be. Look at retirement as a time for exploring, developing new skills, and trying out new interests and activities.

Pick one or two things from the list below and discover if they bring a sense of purpose to your life in retirement:

1. Hobbies in retirement

I believe that everyone has some interests that they were forced to put on the shelf during their working years. But retirement gives you a great opportunity to start over again by pursuing your passion. You should always stay active once you retire. Do not consider yourself as ‘retired from life’. Refocus your energy on learning something new and more interesting than your previous job.

People still enjoys traditional hobbies such as cooking, reading, gardening, coins collecting, building models, even antiquing. If you are not sure where you want to start, compose a list of old hobbies you have enjoyed but had to stop and what hobbies you have wanted to try. Try to choose hobbies with a good mix of activities – physical and mental ones. And try something outside of your comfort zone. Also, it might be fun to try something new with a friend or a family member.

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2. Travel in retirement

These days traveling is a number one goal for most retirees. Many people look forward to traveling after they retire because you are no longer is constrained by the number of vacation days you can take off. You can go whenever you want and for how long you want.

Many people (including myself) looking at retirement as the best time of our lives, a time for fun, adventure, and travel. I believe that one of the biggest benefits of retirement is the freedom to explore the world.

I have found it useful to create a bucket list. That is a list of things I want to do and see in our local area and other countries. My bucket list is always get updated with the name of new places, activities, recommended tours, dates of future travels, and more. Roman and I feel excited when discussing our travel plans, and the places we want to visit.

Today, the fact that people live longer has produced a new generation of adventures – senior travelers. They are bold, resilient, and enthusiastic about fulfilling their childhood dreams. Professional obligations, family life, and financial concerns prevented them from actually doing it. But retirement brings freedom and they do not wait any longer to explore the world.

3. Health and fitness in retirement

Finding your sense of purpose in retirement often comes with staying in good health.

park-woman -bicycle-purpose in life in retirement

During the years of working and raising a family, it is so easy to let your fitness slide. There is not enough time for everything so many of us allow our weight and diet to decline. But once you have retired you will have plenty of time to improve your physical health and fitness.

Stay in shape.

There are still many retirees who spend days lying on a couch watching TV and snacking. Some people gain weight during retirement because they are not active, and began to eat more out of boredom and depression. Overweight and lack of exercise put retirees at great risk of many chronic diseases such as diabetes, stroke, cancer, and heart disease.

But you can get into shape with a healthy diet and regular exercise. Exercise can take many forms – jogging in the mornings, hiking in the woods, biking to the grocery store, taking yoga classes, swimming in the lake. Try to choose an exercise activity that you enjoy so you can stick to it for a long time.

There are many books and videos that you can use for working out from the comforts of your home. But if you want to exercise with others you can join a gym and take group fitness classes. Do not be afraid to try something new such as Pilates, Kickboxing, or Zumba.

Another good idea for staying in shape is to hire a personal trainer and learn new techniques for improving your overall well-being.

Stay in good health.

Maintaining good health is often a number one goal in retirement. Do not wait until something is wrong to visit your doctor. Take a preventive approach and have your regular health check-ups and screenings, so if any problems get caught early you can do something about them.

4. Working in retirement

If you still find that you miss working, there is no reason not to make work your new hobby as long as you find it enjoyable and not stressful.

Part-time jobs

Working part-time in retirement can be a great way to feel fulfilled. Even though your official full-time career has ended, it does not mean you have to stop working completely. The surveys show that many retirees prefer to work part-time jobs to stay busy, socialize with people or simply pursue their lifelong passion.

The Bureau of Labor Statistics predicts that a growing number of the labor force (164 million people by 2024) will have 13 million workers aged 65 and older. Many retirees have enough money to cover their living expenses in retirement. But many others who prefer to take on a part-time job for extra income or to cover the shortage of retirement savings.

There are plenty of part-time jobs for seniors including tutoring jobs, consulting jobs, service jobs, and more. Part-time jobs provide you with extra income and still allow you to enjoy more free time, travel time, and indulge on your hobbies.

Here are some options for the part-time jobs for retirees from the AARP article:

Top 25 Part-Time Jobs for Retirees

Small business

If you are planning to start your own business in retirement, you are not alone. According to statistics, the highest rate of entrepreneurs is in the 55-64 age group. For many people, being retired does not mean never working again. The most popular types of business these days includes consulting services, and freelancing.

coffee shop - purpose and meaning in life in retirement

Whatever business you are planning to start make sure you do something you passionate about. To start a new business will require a lot of time, money, and effort over a prolonged period. You need to be passionate about the product or service you are offering to make your business succeed. Otherwise, you will lose the excitement when faced with challenges fast and will not be able to carry on.

5. Giving back to the community in retirement

Many people choose to give some of their time to charity work and volunteering. Many of us feel the desire to give back to the world in gratitude for the opportunities we had in life. This is a great way to find your purpose in life and stay busy and valued. You will have a chance to meet new people and feel good about yourself while contributing to the community.

Countless groups and organizations are looking for an extra hand and might not have money to hire the help they need. If you need to find an organization, think about what you are passionate about and what matters to you the most. You can volunteer by sitting on Board of Directors, helping renovate housing, tutoring children, or organizing events and fundraisers.

Some great options are to volunteer at a homeless shelter, animal shelter, local hospital, church, and library, or teaching to share your knowledge. Offering your time and assistance to those in need will give you a great sense of purpose and making the world a better place to live.

One of my friends is passionate about helping seniors in her local community. She teaches nutritional training class “Successful Aging” at several senior centers. Currently, she is focused on raising funds for the creation of an Outdoor Recreation Area and Shade Pavilion so older people will spend some time outside in nature and feel less isolated and lonely.

6. Caregiving in retirement

Many people choose to become a caregiver to take care of aging parents who need help with their lives. I know a few neighbors who are taking care of their grandchildren and a friend who retired early to become a caregiver for her disabled brother.

These situations are very common. We all hope for long and healthy lives for our family, but there are times when our loved ones need our help. Becoming a full-time caregiver is not an easy decision and it may affect your lifestyle. But most caregivers take on this new role out of love and good intentions.

Final Thoughts

Retirement is not a one-time event. It takes place over time, and we need to develop new interests, explore different parts of ourselves, and form new identities.

Everyone is different. Your retirement should be about you. And what other people find rewarding and enjoyable might not appeal to you. So, keep looking until you find something that you are passionate about and it adds meaning and purpose to your retirement life.

We would love to hear from you! Do not hesitate to share your thoughts about finding a sense of purpose in retirement in the comments below.

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5 Smart Alternatives to a Traditional Retirement

by Maggie 4 Comments

lake surrounded by mountains - alternatives to traditional retirement

Retirement is one of the most important transitions we face in life, and it includes a huge change in our lifestyle. After working for several decades, building a career, and raising a family we will have to meet each day with no schedules and a lot of time on our hands.

But the landscape of retirement is changing. Not everyone wants a traditional retirement. Not everyone wants to work until their mid-60s, then relocate to a southern state and play golf most of the days. Some people realize they do not want to wait that long to start a life of leisure since we do not know where we will be physically and financially at that time.

The good news is that retirement can be whatever you want it to be with a realistic plan in place.

Here is a look at 5 smart alternatives to traditional retirement.

1). Early Retirement

Early retirement is used to be a privilege of wealthy people. But right now, more people are planning to get out of the workforce before they reach their full retirement age. Early retirement is becoming a popular financial goal even for people in their 30s.

The FIRE (financial independence retire early) movement encourages frugal lifestyle habits. If you want to reach financial independence and retire early, you need to learn how to save, spend and invest smart ways. It takes years of sacrifice, discipline, and careful planning to reach this financial goal. But if you want to achieve financial independence at an early age you can enjoy your dream life much earlier.

young woman at the table with a phone - alternatives to traditional retirement

For example, if you want to stop working at 40, you need to plan for a long retirement. You need to come up with at least 40 years of savings to cover your living, medical and other expenses. And if you want to save enough money to retire early, you need to change your spending habits and commit to a very frugal lifestyle.

Many millennials who are part of the FIRE community aim to live on 50 percent (or less) of their income and the rest goes to savings. They cut on their living and personal expenses for years to save enough money. Working out how to retire early can be challenging. That is why it is important to create a plan and then take it one step at a time.

Steps to take if you want to retire early:

Determine your lifestyle. What do you want to do when you retire early?
Evaluate your current financial situation. Calculate how much money you have saved, how much debt do you have, the total value of your assets.
Estimate your total savings needs. Figure out how much money you will need to support your lifestyle when you stop working for a paycheck. As a rule of thumb, you should have 25 times of your annual spending before you retire.
Make adjustments to your budget. Cut your expenses by downsizing, moving to a cheaper area, buying a used car, eating out less, and more.
Get rid of debt. Pay down debt using either the snowball or avalanche method.
Invest your funds. You should invest your savings for growth so you can generate income from your money.

But I have to admit that early retirement is not realistic or achievable for everyone.

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2). Mini-Retirement

Not everyone wants to make lifelong sacrifices to quit their job at a young age to live a life of leisure. However, not everyone wants to wait until the mid-60s to start enjoying their retirement.

Hence, another great alternative to a traditional retirement is a mini-retirement.

A mini-retirement involves taking a short break from work or a series of short breaks. These breaks may be short as a few weeks or months, or longer as a couple of years. Basically, you take a mini-retirement when you want to get a break from your career. Also, a mini-retirement can be a solution for people who are tired or feeling that they are not taking the right path in life.

You can use a short break from the grind of a full-time job to explore the world, spend more time with kids or just reflect on what you want out of life.

But like everything else in life a mini-retirement requires a lot of planning. You need to establish why are taking a break and how to fund your time off from work, otherwise, it can become a disaster.

Figure out how much time you want to take. This period can be between one to two months, or maybe between six months to one year.
Estimate your living expenses. Calculate how much you need to spend on mortgage or rent, bills, insurance, food, and other daily expenses. If you will be traveling, estimate your travel expenses and add the cost of traveling to your mini-retirement budget.
Establish your budget. Combine your living and travel expenses and multiply by the duration of your mini-retirement.

Even so, a mini-retirement sounds very attractive it might be not for everyone. It is much easier to take a mini-retirement or break from work if you are a freelance worker, contractor, or a digital nomad.

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3). Phased Retirement

Studies show that people aged 60 and older will prefer to gradually transition into retirement by working fewer hours.

The whole idea behind a phased retirement is to not wait to live your life or put off your dreams until old age. People want to spend more time with the family. They want to pursue personal interests or hobbies.

Most people want to enjoy their life while they work and not sacrifice their best years for the pure purpose of building wealth. However, only some people want to completely stop working because work plays an important role in a balanced and fulfilling life. Instead, more people prefer to ease into retirement by shifting from full-time to part-time work.

Key issues to consider that will affect your finances and lifestyle:

Talk to your employer and find out the policies on part-time work and benefits. Depending on how many hours you want to work each month, you could be eligible for retirement benefits and health insurance.
Adjust your budget. Part-time work means less income and savings. Come up with a plan on how to pay bills and living expenses on a reduced income.
Consider your job options. Review your skills and knowledge and think about what jobs will help you use them.

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4). Semi-Retirement

You work hard on your career growth, but at some point, you want to have more time with your spouse and young kids. Or maybe you need to take care of aging parents. How to plan for retirement when you can still continue to work, but have more time with your family?

women with a small child in hands - semi-retirement

Semi-retirement can be an ideal solution for those people who want to enjoy the benefits of a retirement lifestyle without completely giving up their jobs.

If you cannot reduce your hours at your current job, you can try to find a part-time job with another company. The best part is by working part-time you can continue to earn your income, increase your savings, get health and other benefits. Working only part-time can provide a perfect lifestyle balance for many people. It reduces the financial pressure on your retirement assets, keeps your mind sharp by new challenges at work, and yet allows more leisure time.

How to plan for semi-retirement:

Think about what to do with your time. Write down your plans on a piece of paper. Make a list of your goals the same way you make a ‘to-do’ list.
Consider a career in a new field. Try to find a job that matches your interest. Consider switching to a second career when you can use your existing skills like becoming a consultant or a tutor.
Start a side hustle. Starting a part-time hustle like blogging could be a rewarding career change.
Think about health coverage. You will not be qualified for Medicare if you are before age 65. Think about finding part-time work that includes health insurance. It also may be possible to get on your spouse’s insurance.

5). Never Retire

Some people already know that traditional retirement is not a final goal for them. After all, a lifestyle of leisure is not appealing to everyone. They love their jobs and prefer to continue working as long as possible. And if you are in a good health and taking care of yourself you can work as long as you can. You still need to continue saving for retirement in case of a health issue, a family emergency, or a sudden layoff. Also, you should have a plan for when to take Social Security and retirement distributions.

Traditional Retirement

If none of the above-mentioned alternatives appeals to you, there is always the traditional retirement route. It means working most of your life and retiring at the full retirement age around your mid-60s. At this age you will be covered by Medicare, start living off the combined income from Social Security, pension, and your retirement savings. The good news is that with years of working and diligent retirement planning you could still enjoy a comfortable retirement.

Find your path. Now that you have more time, there is a whole new world out there waiting to be discovered. Think about whether you want to spend your free time doing something similar you did before retirement, or if you want to try something different. Write down a list of interests and activities that brings you joy even some of them you might put on the back burner for a while. Do not forget to include in your list new things you like to learn.

All those things we regret not having time to do during our working years can act as an inspiration when we transition to retirement. There are endless possibilities to explore once you have time and the freedom of retirement.

Final Words

Retirement is no longer a one-size-fits-all matter. There has been a huge transformation in the types of retirement. With changes in the working environment, people structure their type of retirement to have a lifestyle they really want to live.

Have you thought about alternatives to a traditional retirement? Share your thoughts in the comments below.

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