5 Essential Pieces of Financial Advice for Baby Boomers
If you were born between 1946 and 1964, you’re classed as a baby boomer. The good news is you are living longer than your parents and grandparents. But, it’s not all rosy. The bad news is you are living a much more expensive life. You’re tackling decisions which previous generations didn’t have to deal with. You might be hoping to retire at 65, but due to increasing life spans, it’s fair to say you will live well into your ninth decade.
Is your retirement fund large enough to allow you to live comfortably for 25-30 years – a third of your life? Have you considered the costs of living in a retirement home? Here are 5 essential pieces of advice that you need to hear.
1. Find the Right Financial Advisor
Ironically, the average American puts more time into comparing the costs and qualities of a new television, than the costs and qualities of a financial advisor. If you want to find the best person to help, check out www.napfa.org – use the ‘How to Guide’ which is an introduction to investment and planning in the world of finance.
If you’re not sure how much you need to pay someone to handle your investments, or are wondering if your portfolio is sufficiently diverse, this guide will inform you. On top of that, it explains confusing annuities that you may have been sold, as well as discussing when to hire outside help to get a hold of your finances.
2. Take Your Time when Making Decisions About Social Security
The Social Security Administration isn’t designed to provide the best strategy for you – so, it’s best to consult with your financial advisor before you make any life-changing decisions. If you end up making any quick, unresearched decisions you risk missing out on a lot of money. As previously mentioned, your retirement could last 30+ years, so you need to accumulate as much as money as possible.
3. Think About the Last 15+ Years of Your Life
Where will you be living when you are 82? In your large family home with a giant staircase? Will most of your wealth be tied up in your house? Who will care for you as you get older? It’s unreliable to rely on your spouse, as they may have needs of their own. Get advice about long-term care planning and Reverse Mortgage options from a trusted financial planner who doesn’t make money selling either.
4. Consolidate Your Holdings and Paper Trail
Get a grip on all of your holdings and your paper trail so you know exactly what you own. This will greatly benefit your future heirs. Do you have old 401k plans or pensions from different employers? Various accounts run by different brokers? Old, outdated estate documents? Every year, millions of dollars worth of plans and insurance policies remain unclaimed because the beneficiaries weren’t aware of all the policies held.
5. Talk to Your Children and Siblings
It’s a good idea to have a serious talk with your adult children and siblings about where your assets are located, and how you would prefer to be handled if you end up in hospital. There’s no need to give your family or friends specific information about how much money you have, but they should know about your wishes and asset location if you become disabled, unconscious or pass away. Make it as easy as you can for your executor and your heirs.