Personal finances when we retire, what can we do?

The proximity of old age makes it necessary for us to prepare ourselves to enjoy it despite the inconveniences to our health, experts in personal finance advise us to plan in advance, not to wait for the proximity of retirement to decide what we will do with our lives.

In the book Personal Finance for Dummies Eric Tyson makes several financial suggestions or recommendations for situations that mean changes in our lives. About retirement he suggests the following:

When we retire we must do everything possible so that our standard of living allows us to enjoy free time. Photo: Pixabay.

1. Plan finances and personal life

Facing retirement requires us to prepare for various aspects of our lives, which have to do with our psychology, emotional state and even social issues. It is necessary to leave as a goal of life to stay active and enjoy the best form of freedom since there is no commitment to comply with working hours.

Tyson says that the challenge of retirement is what to do with all the free time, he believes that planning activities to do can be more important than planning finances.

2. Take inventory of resources

Knowing the amount of resources you have allows you to evaluate what you have compared to what you need. Ideally, in addition to the income we receive as retirees, we receive support from our children or our families; but if possible, let’s organize our lives so that we don’t need that support.

3. Reassess insurance needs

In his suggestions regarding various aspects of change in our lives, Tyson refers to insurance. If, since the first job is obtained, he speaks of the need to have insurance when we approach old age and retirement, we must have them, and look for and obtain those that benefit us the most.

4. Evaluate health and life care options

While Tyson recommends that children support their older adults in all aspects, when we retire we must get involved in that care, do our part by taking proper care of our health. The personal and financial situation makes it possible to determine if a supplementary insurance is purchased, if you enter a retirement society or do nothing.

5. Decide what to do with the retirement plan money

The retiree’s personal finances can be strengthened if our economy is planned in advance. Saving as much as possible is very important. We must also decide whether despite our age we will continue to work.

6. Choose a pension option

Ideally, choose a plan that pays a monthly benefit during retirement, this is equivalent to making a good investment. If you suffer from a disease that will shorten life expectancy, it is appropriate to collect your pension earlier. The new pension schemes, to avoid the burden of the retirees in the finances of the State, have changed this option for the accumulation of individual savings.

7. Put the heritage in order

When we retire, it is convenient to research wills that are beneficial to us and our heirs. If you have more than you need, Tyson says, monetary gifts can be given.

More information in our Retirement section.