Someone working beyond their senior years most likely wants to secure a future for their loved ones.
Also, they may want to increase the savings they have left. According to a poll conducted by Provision Living, six out of ten seniors answered that the main reason they still work is for monetary purposes.
Provision Living is a company that provides for senior communities. The company gathered 1,032 respondents for the poll last August, with an age range of sixty-five to eighty-five years old. The surveyed seniors are still working part-time or full-time.
Of the many reasons for working until after their senior years, the most common answers were as follows:
- Not being able to afford retirement.
- They want to support their families continually.
- They need to finish paying loans or debts.
Tricia Harte is a representative of Provision Living, and she sees the seniors’ current position as a somewhat difficult one. Aside from having hospital expenses and unwanted extra costs, Harte believes that the Senior citizen’s situation regarding retirement ultimately contributes to the overall condition. In addition to this, Tricia says that working past the retirement age could be due to the benefits they have at work. The people may also want to control their expenses and bills.
According to Provision Living’s research, the average savings of a senior citizen is $133,108. In reality, a universal principle is that seniors should at least have savings that are eight times their initial salary. Unfortunately, Fidelity Investments found out that a senior couple who plans to retire in 2019 should expect to have at least $285,000 on medical expenses alone.
On the other hand, a survey conducted by the Transamerica Center for Retirement Studies shows that 30% of working seniors want to keep their jobs because of the hospital benefits. The main concern is health, life, and disability insurance costs. Seniors relax at the thought of securing the future because of the benefits their employers offer. In addition to this, group insurance is a better choice compared to plans that cater to singles.
For seniors who wish to continue working beyond their retirement age, take note of the following:
Take Note Of Your Overall Savings
Make sure you have an overall assessment of your current savings together with plans regarding sharing profits. According to Dan Herron, you should also settle your ESOP (Employee Stock Ownership Plan). The ESOP is a type of benefit that allows workers to have an ownership interest in the company. Herron is a Certified Public Accountant and a principal of Elemental Wealth Advisors.
Another thing to take note of is the vesting schedule, which allows the employees to have full ownership of retirement funds and possibly, stock options. Inquiries regarding the vesting schedule can give you an estimation of the remaining time you have before you can fully receive all benefits.
Consider Your Required Minimum Distributions (RMDs)
RMDs are the amount of money you should withdraw from your IRA account before retirement. Failure to do so may cause additional charges and penalties. On the other hand, the situation is a bit different for seniors who continue to work. These people have the choice of not withdrawing their RMDs.
Carefully And Thoroughly Plan Your Retirement
As you get older, you need to be more conscious of how things may go down in terms of medical expenses or personal needs, and possible inheritance plans. Talking to a financial advisor may be the best way to get a bird’s eye view of your overall financial situation. This strategy further secures your future, as well as your loved ones. According to Herron, early consultation regarding your benefits is a necessity.