- Decide when to claim Social Security – Deciding when you claim your Social Security is a big part of the process. You might be able to claim it at 62, but you won’t receive your full benefit until later, as late as age 67, depending on the country in which you were born. By claiming it earlier, you’ll give up a big amount of money each month. The start date on which you decide on Social Security benefits will deeply impact your retirement life. You’ll receive a lower monthly payment, and you’ll also receive less when Social Security adjusts its payout each year.
- Line up post-retirement health care – If you decide to retire at age 62, you won’t be able to start Medicare (as you need to wait until 65), so you’ll have to consider other alternatives. Some people opt to relocate abroad for a low-cost plan or use COBRA, while others will simply access a state-based healthcare plan. But the latter can cost way more.
- Prepare for the unexpected – You definitely don’t want to run your retirement expenses too close to your budget, because you’ll risk financial ruin if something unexpected happens. By planning everything too closely, you might make a mistake or forget to incorporate some expenses. In this case, your retirement won’t go as planned and you’ll have to face an unpleasant situation. You must anticipate cost overruns and unexpected expenses. Consider adding some expected “unexpected” expenses, such as home maintenance, car repairs, replacements, and most important, rising medical expenses. It’s wise to have a cushion in your budget…better safe than sorry!
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