If you’re in your fifties, you are probably beginning to feel more concerned about retirement. At this point in time, most of us begin to seriously evaluate our ability to retire someday, we kick our savings into high gear, and we start trying to pinpoint a target retirement date.
Most of us assume that we’ll work until “sixty-something”, but beyond that guess, we aren’t really sure when we’ll retire. It is often a good idea to wait until you reach full retirement age, as defined by Social Security, so that you can access your full scheduled benefits. However, because Social Security does allow you to claim your benefits as early as age 62 – many people begin to wonder if they could go ahead and take the leap at that age.
It is certainly possible to retire at age 62, but we urge you to consider two very important factors first.
Your “other” retirement income. Since your Social Security benefits will be reduced if you claim them early, your other forms of retirement income become even more crucial. Not only do you need to create a livable monthly budget; you also need to worry about that money lasting a few years longer (since your retirement will now be longer).
Healthcare. This issue might be even more important. You won’t be eligible for Medicare for three more years, so what will you do about healthcare in the meantime?
If your employer offers retiree benefits, check to be sure the plan is financially feasible. The premiums, deductible, or co-pays might surprise you.
You could also purchase your own health insurance policy, but remember to budget for premium increases. In recent years many people’s premiums have increased dramatically each January.
Whatever you do, don’t gamble and try to go without health insurance until you become eligible for Medicare. Health problems begin to increase in both frequency and severity throughout our sixties, and lack of health insurance could prove financially disastrous.
If an earlier retirement appeals to you, schedule a meeting with us to discuss the idea. It is definitely a possibility for many people, but we should review your plans carefully to identify and address any possible problems.