From traveling the world and visiting exotic vacation destinations to writing novels and spending quality time with friends and family, stepping into your golden years can be exciting. However, with longer life expectancies and ever-changing markets driving up costs, trying to make the best financial decisions can seem overwhelming. Nonetheless, ensuring your finances are in order is essential for enjoying a comfortable retirement. Many seniors face a unique set of financial challenges that they must navigate, such as medical expenses, fixed incomes, and estate planning.
In this article, we will discuss five financial moves to make if you are over 70 that can help you make the most of your retirement years. Keep reading to find out how to maximize your retirement income and enjoy the fruits of your labor.
- Get a life insurance policy
While life insurance is generally less expensive to get when you’re young, it can also be an affordable option for seniors. If you have dependents or loved ones who rely on you for financial support, a life insurance policy can offer them a safety net after your death.
When looking for the best life insurance for seniors[a], several options are available: term, whole, universal, variable universal, and guaranteed life insurance policies. Guaranteed life insurance for seniors[b], also referred to as guaranteed issue life insurance, usually doesn’t require a medical exam, and you’ll be eligible as long as you meet the age requirements. However, these policies usually come with higher premiums and lower death benefits.
- Review your retirement accounts
Compulsory withdrawals, or required minimum distributions (RMDs), mandate individuals to withdraw a minimum sum from your retirement accounts every year. Typically, you must start withdrawing funds from your traditional retirement plan accounts (IRA, SEP IRA, and SIMPLE IRA) when you turn 72 (or 73 if you reach 72 after Dec. 31, 2022).1
A financial advisor can help review your retirement income strategy, ensure that you’re taking the correct amount of RMDs, and suggest any necessary changes to your investment strategy to prevent outliving your retirement savings.
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Review your investment portfolio
If you’re over 70, you may want to review your investments and adjust your asset allocation to include more conservative investments, such as bonds or cash. You may also consider reducing your exposure to stocks due to market volatility. While conservative investments tend to provide more stability, they may also have lower returns.
A financial advisor can help you review and adjust your investment strategy based on your current financial situation, goals, and risk tolerance.
- Plan for end-of-life care
End-of-life care is an important consideration for seniors, and it’s important to have a plan in place. Such a plan involves making decisions about the type of care you may need and ways to finance it. You can also consider purchasing long-term care insurance that can provide nursing-home care, home-health care, and personal or adult day care for seniors. While long-term care insurance can assist with the expenses related to end-of-life care, it’s important to explore available options and plan accordingly to ensure adequate coverage.
You can also talk to your loved ones and healthcare providers about your end-of-life care wishes.
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Review your estate plan
Having an estate plan is essential to safeguard assets you’ve worked to accumulate during your life. A well-crafted estate plan can help ensure that your wishes are followed and may also reduce the taxes owed on your estate. Your estate plan typically includes a will, power of attorney, and healthcare proxy.
Regularly reviewing your estate plan is crucial to ensure it remains up-to-date and reflects any changes in your circumstances. An annual review is sufficient for most people unless you have a significant life event, like a divorce or the passing of a beneficiary.
It’s important to seek advice from an experienced estate planning attorney when creating an estate plan, as they can guide you through the process and make sure everything is done correctly. They can provide guidance on the best strategies to transfer your assets to your successors and ensure your wishes are carried out.
The bottom line
Securing your financial future and ensuring you have adequate funds to cover your expenses throughout retirement is important. If you’re retired or nearing retirement age, exploring certain financial moves like obtaining life insurance policies, planning for end-of-life care expenses, assessing your investments, and modifying your investment strategy can help you enjoy a comfortable retirement and leave a legacy for your loved ones.
Content within this article is provided for general informational purposes and is not provided as tax, legal, health, or financial advice for any person or for any specific situation. Employers, employees, and other individuals should contact their own advisers about their situations. For complete details, including availability and costs of Aflac insurance, please contact your local Aflac agent.
Aflac insurance coverage is underwritten by Aflac. In New York, coverage underwritten by Aflac New York.
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[Footnote sources]
1 IRS. “Retirement Plan and IRA Required Minimum Distributions FAQs”
[a]Z2100522R1; EXP 10/23
[b]Z2100992R1; EXP 11/23