The Retirement Plan for the ages

Dec 22, 2014

•  
•  
  
•  Comment

• Share on LinkedIn
• Share on Facebook
• Share on Google Plus
• Share on Twitter

The retirement world is largely focused on 401(k) and traditional defined benefit plans. But investors and financial advisers alike should be paying closer attention to something called a cash balance pension plan.

Cash balance plans are the fastest-growing part of the defined-benefit pension universe and could become as numerous as 401(k) plans within the next few years, according to the trade publication Pension & Investments.

Consider: The number of such plans rose from 1,300 in 2000 to more than 7,600 in 2010, an average annual growth rate of around 20%, according to recent research from Sage Advisory Services. (See Sage Advisory’s recent news release, “Cash balance plans challenge 401(k) supremacy.”)

What’s more, the number of participants nationwide in cash balance plans reached 11 million in 2011.

At Advanced Retirement Benefits, (ARB) we strive to provide advisors' advanced planning strategies and products. In doing so we help them better service their high net worth clients and add new dimensions to their practice.

Through ARB, you’ll have access to our source of leads as well as access to our network of established, advanced planning specialists. These specialists have expertise in the legal, tax, actuarial science and risk management fields.   

John Cornish III, Strategic Partner at ARB

Tax Advantage Planning, Formation & Consulting Services

Greater Los Angeles Area

Financial Services

Retirement planning is more than just Social Security, an IRA, and a 401K, it’s important to also consider your healthcare.

Retirement planning is more than just Social Security, an IRA, and a 401K, it’s important to also consider your healthcare.

Create an Advance Directive

An advance directive is a document that names someone you trust to make health decisions if you can’t. It’s basically a durable power of attorney that you can obtain from your attorney, health provider, local aging agency, or state health department. You’ll want to carry a copy on your person, as well as give a copy to your attorney (if you have one), healthcare provider, family, and friends.

Devise a Long Term Care Plan

According to the Center for Medicare and Medicaid Services, 70% of all persons 65 and over will require Long Term Care (LTC) at some point. It’s important to note that Medicare doesn’t cover Long Term Care, therefore devising a long term health plan while you’re healthy will lessen confusion for you and your loved ones if an emergency or serious illness occurs.

LTC is considered custodial care which includes bathing, housework, caring for a pet, eating, and long term nursing. The ways to plan for this type of care is to designate a family member or friend for your custodial care, research Long Term Care facilities in your area, and look into Long Term Care insurance. LTC insurance can be very expensive and should be purchased as early as possible to be affordable and meet eligibility requirements.

Medicare Options for Short-Term Care

There are other health issues that can come up during your retirement other than becoming incapacitated or needing custodial care. For instance, Skilled Nursing Facility, Inpatient Rehab Facility, and Home Health Care are there to meet your needs if you have an injury or a stroke or are in need of short term care. If you have Medicare, Home Health Care is at no cost to you, except for durable equipment, but if you need Skilled Nursing Facility or Inpatient Rehab Care you could owe quite a bit out of pocket because deductibles and coinsurance applies.

Medicare’s limitless out of pocket costs can be lessened if you have job-based insurance, VA benefits, Medicaid, other retirement benefits or Medicare Supplement insurance (Medigap) or a Medicare Advantage plan. As with Long Term Care, you’ll want to purchase Medigap early (when you first enroll in Part B) to ensure eligibility, as well as keep the cost down.

Along with all of the above,preventive care, like exercising regularly, eating a well-balanced diet, quitting smoking (Medicare helps with smoking cessation), visiting your doctor regularly, and getting your vision checked, can help prevent illness, falls, and injury.

 

Author Bio

Amy De Vore helps boomers understand the difference between Medicare Advantage and Medigapfor Senior65. When she isn’t writing about healthcare she is an MFA candidate at University of Riverside, California.

 

What Did Retirement Planning Week Teach You?

What Did Retirement Planning Week Teach You?

BY: Bonnie Pham

The week of April 7-11 is one that went by for most people without much fanfare. Without realizing it, they missed what was, perhaps, one of the more important weeks for consideration among those who are facing retirement. That week in April was national retirement planning week, and it is one that can help you to look to the future and plan for a time in your life that can either be enjoyable or stressful, depending upon how you plan for it.

According to current statistics, there are approximately 10,000 individuals who retire from their jobs each and every day. Unfortunately, although the number of retirees is increasing, the amount of financial planning that takes place in advance of their retiring is on the decline. It is estimated that only one out of every three individuals who are retiring are doing so with an optimistic outlook for their golden years.

The process of planning for retirement is one that can begin in a very young age. With careful planning and the development of a budget, you can begin setting aside for your retirement years from the time that you enter into the workforce. Setting up retirement accounts, such as a 401(k) is something that is typically done through your place of employment. Although most people are not a financial expert, employees often hire companies that will assist them through the process and in making sure that the employees are well cared for by the time that they retire.

Something else that needs to be considered is the retirement age. Although there are specific ages that are established on a federal level, there is no reason that you would need to wait until that age to enjoy what retirement has to offer. With careful planning, it may be possible for you to retire at a much younger age and to do so with a significant nest egg which will provide for you and your family for the long-term.

Sources:

1.       "National Retirement Planning Week is April 7-11" from Insurancenewsnet.com: http://insurancenewsnet.com/oarticle/2014/04/08/national-retirement-planning-week-is-april-7-11-a-486427.html

2.       "Retirement Plan Services" from BayPoint Benefits: http://baypointbenefits.com/index.php/solutions/retirement-services