What to Know About Money and Work By 50, 60, 70
Master these skills for your finances and career when turning each age
By Liza Kaufman Hogan for Next Avenue
Editor’s note: This is the first in a four-part blog series on life skills and knowledge that are good to have at each age. The other blogs are: What to Know About Caregiving By 50, 60 and 70; What to Know About Health By 50, 60 and 70 and What to Know About Living By 50, 60 and 70.
Staying on track with your finances and career requires checking in every so often to be sure you’re meeting your goals and anticipating your needs at each life stage. Although you may have been saving for retirement and enjoying success at work for years, there are still some things to learn. You may have gaps in expertise you’d like to fill or may be ready to plunge into a new career.
Whatever your goals, here’s a checklist of basic money and career management knowledge it’s good to have by age 50, 60 and 70:
Money & Security | What to Know By:
By 50, hopefully, you are saving seriously for retirement with a good sense of how much you’ll need to retire comfortably. Think creatively about the ways you’ll want to lead the next 30 to 40 years and how you’ll do it.
1. Make a plan. There’s more to preparing for retirement or financial independence than just socking away the maximum allowed contribution in your 401(k) — which happens to be $24,000 in 2015 for people 50 and older. Take steps to consolidate your finances and pay off debt as well as to begin thinking about where you’ll want to live. Here’s a checklist to walk you through some of the things you’ll want to consider.
2. Estimate how much money you’ll need to retire. There are many useful retirement calculators online to help you rough this out. It’s good to have a ballpark figure to help stay on track with savings and investments. But beware, calculators can be misleading for a few reasons.
3. Catch up on your savings. If you were hit by the recession or experienced a financial setback in your 40s — such as a divorce or an extended illness — you may have some catching up to do. Fortunately, federal law allows people 50 and older to sock away more in their employer-sponsored retirement plans than younger people.
By the time you’re 60, you likely have your retirement plan in place and your goal is staying on track. In the next decade, you will be eligible for Medicare and Social Security, so you’ll need to understand your choices. And if you haven’t decided how you will pay for long-term care if necessary, this is an excellent time to consider that.
1. Anticipate potential long-term care and health care costs. Both are the big wildcards in retirement planning. It’s hard to know exactly how much you’ll need, but you can take a stab at it. And you’ll need to decide, if you haven’t already, whether you’ll purchase long-term care insurance (or perhaps a hybrid of long-term care insurance and life insurance) or save separately for this expense. Keep in mind that, generally speaking, the older you are, the more expensive a long-term care policy will be.
2. Maximize your Social Security retirement benefits. One of the most important decisions you’ll make in your 60s is when to begin receiving Social Security — right away at age 62, waiting until age 70 (the latest you can start claiming) or somewhere in between. With thousands of dollars and future monthly income at stake, you’ll want to weigh your options carefully.
3. Get familiar with Medicare. At age 65, you can start getting health coverage through Medicare with or without a supplemental private plan. Get ready by learning what Medicare covers and how to avoid mistakes when enrolling.
For those turning 70, it’s wise to review your investments, income and savings and make sure they are adequate to pay for your lifestyle. This is also the time to be sure you check your living will and make sure your key financial documents reflect your end-of-life and inheritance wishes.
1. Stay within your budget. Even as you are saving, you need to be sure you are spending wisely — especially if you have reduced your income or plan to do so in the next few years.
2. Plan how you’ll withdraw your retirement income. Maybe you thought you’d just move your funds to a bank account and withdraw what you need monthly. But your money will last longer if you are strategic about which funds to tap and when. Here’s a guide to spending down your nest egg. It’s also a good idea to have a retirement income strategy in place ensuring that your investments keep growing even as you tap into them.
3. Put your papers in order. By age 70, you should have a living will and estate planning documents such as a will and perhaps a trust in place. It’s important to review these periodically to be sure that your beneficiaries, trustees and healthcare agents are up to date and reflect your wishes, especially if those have changed.
Work & Purpose | What to Know By:
At this age, after decades of working in one field — perhaps even at one employer — you may be ready for a change, whether that’s becoming an entrepreneur or looking for a different job. This is also a time to give back by sharing your knowledge and expertise with younger people who could profit by learning from you.
1. Consider starting a business. If running your own company is a longtime dream or the alternative after a layoff, here are some tips for getting started after 50. Did you know that older entrepreneurs represent the fastest-growing segment of business startups?
2. Become a mentor. After many years in your field, you may find it gratifying to share your knowledge with colleagues who are just starting out. But the benefits can run both ways through reverse mentoring; your younger co-workers may teach you a thing or two as well.
3. Update your resumé. Refreshing your resumé means more than just adding your most recent job and skills. At 50, it also means reworking it in a way to prevent hiring managers from seeing your age as a liability. Follow these tips to age-proof your resumé and you may land more interviews.
A MetLife Foundation study found that four out of five boomers plan to keep working well past traditional retirement age. If this is your plan, then you’ll want to take steps now to stay sharp in your career. You may also want to use this stage of your life to try something entirely different and switch fields, perhaps going from a corporate job to a nonprofit. Here are some ways to reset, change course and add meaning to your career.
1. Fall in love with your job again. Take these steps to find new meaning in the work you’ve been doing for a while.
2. Launch an encore career. If a total change in direction sounds appealing, try finding work with purpose through a career matchmaking service. If you’d like to use your existing skills in more meaningful ways without needing to retrain for a new field, follow the lead of these Purpose Prize winners who took that path.
3. Know when to ask for help. Switching fields isn’t easy; don’t go it alone. Ask others who have completed a successful career shift for their help. Talk to people in the field you want to enter to find out what you need to know and how to break in.
According to the U.S. Bureau of Labor Statistics, the number of people working past age 70 has been increasing dramatically and shows no sign of slowing. Here are ways to stay in the workforce, either full-time or part-time:
1. Keep working full-time if you want and are able to do so. Be inspired by these workers over 75 who love what they do.
2. Look for part-time work. Follow these tips to find gigs and part-time work.
3. Balance leisure and work. Working after 70 doesn’t have to mean all work and no play. Try these ideas for having both.
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Posted on August 24, 2016