Knowledge is retirement power
According to the latest Fidelity Retiree Health Care Cost Estimate (2020), an average retired couple age 65 may need approximately $295,000 saved (after tax) to cover health care expenses in retirement. Of course, the amount you’ll need will depend on when and where you retire, how healthy you are, and how long you live. Whether retirement is a long way off for you, or it’s starting to get closer, it’s a smart move to start planning for healthcare costs. The AARP Health Care Costs Calculator (www.aarp.org) is an educational tool designed to help you estimate your health care costs in retirement. You can include a spouse or partner in the calculation as well.
How do I establish an emergency fund?
It’s important to have an easily accessible emergency fund available for when something unexpected comes up, such as a car, refrigerator or dishwasher breaking down. Here are the key features of an emergency fund:
- Aim to have 3-6 months of living expenses saved
- Keep separate from your checking account
- No (or low) transaction fees; no penalties for withdrawals
- Interest earnings on the balance (a little something is better than nothing).
Tools and techniques
According to the 2020 Retirement Confidence Survey,* half of workers (48%) have tried to calculate how much money they will need to live comfortably in retirement. It’s always a good idea to get a ballpark estimate each year to see where you are at. Your retirement plan recordkeeper will likely have calculators available on their website. You can also check out the AARP Retirement Calculator at: www.aarp.org. In addition, you can access a number of comprehensive retirement planning calculators at smartasset.com/retirement.
* The annual Retirement Confidence Survey is conducted by the Employee Benefit Research Institute and independent research firm Greenwald & Associates.
Disclosures: This material was created for educational and informational purposes only and is not intended as ERISA, tax, legal or investment advice. If you are seeking investment advice specific to your needs, such advice services must be obtained on your own separate from this educational material.
Investment Advice offered through Diversified Financial Advisors, LLC, a registered Investment Advisor.
RP-709-0321 Tracking #1-05120034 (Exp. 03/22)