Financial Considerations For Growing Older

Money/Finances - Retirement

By: JenniferAWalker 19-Feb-2011

Introduction:

Much as we may try to stop the process, we're all getting older every single day. Rather than taking a fatalistic view, however, use that knowledge to plan for your future now, so you don't have to worry later.

Life Insurance

In many ways, life insurance is a young person's concern. You want to have enough money to provide for your spouse and kids when you die, so that they aren't struggling to make ends meet. When you're older, you don't have as many people depending on you for income. Ensure you have enough money, either through savings, retirement income, or life insurance to pay for a funeral and dependent care, but don't rush out to get a $250,000 policy when your mortgage is paid off, your kids are grown, and your spouse makes enough from social security and pensions to cover their needs.

Retirement Income

Gone are the days when most people could count on a pension from their job when they retire. Today employers rely on employees to provide their own retirement income, through 401(k) or similar programs. Start funding your 401(k) when you're young, as much as you can to the maximum, and your retirement savings will grow exponentially as you get older.

Social Security

Just as pensions are no longer a sure thing, neither is Social Security. The Social Security Administration sends out letters every so often, detailing how much money you'll get each month if you retire at a certain age. If you're more than ten years from retirement age, do yourself a favor and don't count on Social Security when you retire. If the program survives, it will be a nice boost to your retirement income.

Health Insurance

The older you get, in general, the more health issues you'll encounter. As a result, your health insurance costs will increase, both in premiums and in out-of-pocket costs. Take some time to learn about Medicare, prescription coverage, and supplemental insurance before you need to make any decisions. The details may change over time, but if you understand the process now, you'll be better able to deal with any changes that come.

Probate

If you die without a will, your estate goes through probate, which can take several months and may use up a lot of your funds. Even with a will, your heirs may have to wait for the probate court to settle your estate. Consider setting up a trust to avoid probate, or place your assets in joint names with your spouse and/or children; joint accounts transfer on death to the survivor.

Final Thoughts

Growing older is rarely a fun concept, once you pass 21, but there's no reason to dread it, either. Older people naturally get more respect and better credit ratings. Embrace your aging, and remember -- you're only as old as you act!

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clewand550 2/7/2012
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Excellent list of 5. Thanks for sharing this list.
Katie 7/8/2011
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I would add long term care insurance to the list too
tracyann 4/17/2011
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Fantastic list!
goodselfme 3/27/2011
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Very wise information for the aging population to do before necessity demands those.
Ellie 2/19/2011
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This is great advice! Many people are not aware of the choices they will have to make as they grow older. Thanks for sharing :)
ListMaker 2/19/2011
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Great list! It's so important to get financial affairs in order so that we can grow older in style!