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Retirement Solutions 

What Retirement Solutions? 

After years of hard work, most people are eagerly anticipating retirement. Choosing when to retire is an important decision and involves a number of issues you may want to consider in your retirement planning. The more you know before you start making decisions, the better off you will be in retirement. This retirement savings toolkit is brought to you by the Department of Labor, the Centers for Medicare & Medicaid Services, and the Social Security Administration. These federal agencies have different levels of involvement in planning and security in retirement.

The retirement savings toolkit includes a list of articles and online tools to assist in making decisions and planning for your retirement. The retirement savings toolkit also includes information on how to contact us with your specific questions. It is important to get started as soon as possible with planning. This ensures you are well informed to make timely decisions and, if necessary, make changes while you still have time before retirement. The timeline and retirement savings toolkit below can help you plan for the kind of retirement you want.

Social Security

The Social Security Retirement Toolkit and Social Security Benefit Planners are essential in making a determination as to the optimal time to start receiving benefits. In utilizing the information from the Social Security Benefit Planners and waiting until full retirement age, you maximize your benefits. Extending time beyond full retirement age provides the option to increase benefits by about eight percent a year, up to seventy years of age. In the Social Security Retirement Toolkit, information on the reduction in benefits if you claim before full retirement age allows you to weigh your options.

Social Security’s full retirement age depends on the year in which you were born. If you were born in 1942 or earlier, you are already eligible for your full Social Security benefit. If you were born between 1943 and 1954, your full retirement age is 66. If you were born between 1955 and 1959, your full retirement age increases gradually until it reaches age 67 for those born in 1960 or later. The Social Security Retirement Toolkit and Social Security Benefit Planners are helpful in making the best decision based on your age and financial needs.

If you claim benefits before your full retirement age and continue to work, your income will be subject to the retirement earnings test, and your benefits could be reduced if your earnings exceed a certain limit. However, once you reach full retirement age, your monthly benefit will be increased permanently to account for any months in which benefits were reduced. The retirement earnings test no longer applies after you attain your full retirement age, and your benefit will not be reduced no matter how much you earn. After benefits begin, any cost-of-living increases will be included in an annual adjustment to the amount of the benefits.

What are annuities?

In short, annuities are vehicles that are established by Life Insurance Companies to provide a holding place for assets (money). There are multiple types of annuities and they all have different features, however they all have one thing in common: they all exist within a Life Insurance Company’s portfolio of products as sort of a “Sibling” to Life Insurance. While Life insurance is designed primarily as a protection in the event of death, annuities are primarily implemented as an income vehicle.

 

When considering annuities, we ask our clients 1 basic question – “would you suffer in the event that your income was to decrease more than 20% or was to run out 20% earlier than anticipated? If our client answers “yes” to this question, then an annuity should be considered.

Considering annuities does not always mean that you purchase one. There are many clients who are simply not the right fit for annuities, and this is where education is key. There are many advisors in today’s industry who believe everyone should have an annuity, and there are advisors who believe that annuities are always bad. The Turning 65 Advisor does not agree with either of these stances. Annuities are a tool that can be used to assist someone in accomplishing the goals they have set forth in their retirement. 

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