When it comes to retirement planning, many people are more focused on saving up and finding ways to build up a sizable retirement fund. Others are concerned about investment opportunities to let their money work for them. But there are also other aspects of retirement planning that many people seem to leave out. They are just as important since they can have an effect on how much of your retirement fund that you can enjoy later on. Here are just some of them.
What To Do With Your Home
Many people consider their homes as an asset. But given the volatile situation of the real estate market, it may no longer be as viable as an asset as it was before. With the availability of home equity loans, it can even be a source of added debt for people approaching retirement. It is important for people to have a plan for their home once they retire. One reason is that a family home can sometimes be more costly to maintain once the homeowner retires. It may even be bigger as a home than what retirees really need. A retirement plan should also include knowing what to do with it once one retires.
Taxes, Taxes, And More Taxes
Even if one becomes a retiree, the tax concerns may still continue to hound you. It even becomes more of an issue since you may now be depending more on your withdrawals from your retirement accounts as your main source of income. Most incomes from retirement accounts are usually taxed as ordinary income. This means that as much as 40 percent of your withdrawals from your traditional 401(k) or IRA may go to taxes. It is something that you should also consider when you plan for your retirement.
One important thing to expect when you retire is the possibility of increased medical expenses. You need to ensure that you may be able to protect yourself from the mounting expenses. A good retirement plan also includes ensuring that your health insurance coverage is well taken care of, with all the necessary supplementary coverage in mind.