A senior man and woman reviewing finances for retirement living.

Retirement Finances and the Cost of Senior Living

The cost of living is often a cause for worry for many people, and it can be particularly stressful for those who are approaching retirement age. The expenses associated with aging are many, and the thought of retiring and losing your current income source can be daunting. But there are many ways in which seniors can finance their retirement, and many resources out there to help you afford the cost of senior living.

This blog will explain the steps you can take to prepare for financing retirement, and give you insights about care costs, social security benefits and asset management so you can create a plan for happy retirement years.

Retirement Planning

The best way to ensure a comfortable retirement is to put a plan in place as early as possible. To do this, you need to meet with an expert. A certified financial planner will analyze your finances and map out a plan for your future. There are many qualified and helpful professionals to choose from. 

You may want to ask a family member to help you choose a financial planner and to be involved in the financial decision-making process. Knowing that someone you trust is there to help you understand and make decisions can bring you tremendous peace of mind.

Early in the planning process you’ll want to get a clear picture of what your cost of living is projected to be during your retirement years. You may want to consider the following possible expenses:

  • Housing
  • Utilities
  • Health Care
  • Car Insurance and Transportation
  • Long Term Care Insurance
  • Home Maintenance
  • Food and Personal Care
  • Leisure and Entertainment

Having these costs laid out can give you a clear picture of what your retirement may look like, and allow you to adjust in certain areas to save money.

Sources of Income for Financing Retirement

Many people have a pension, a 401(K), or an IRA that they have earned over the course of their career. These assets have been growing over time with tax deferred benefits, and are a primary source of retirement income.

As you near retirement, and enter retirement, you will want to change how your assets are distributed and invested. This is a big part of how a financial planner will help you. It’s okay if you don’t understand every detail of your financial asset allocation. Your financial planner will.

Social Security Benefits and Medicare

Once you turn 65, your Social Security benefits kick in. This is a large part of anyone’s retirement plan, as roughly 65 million Americans receive regular Social Security payments. There’s a lot of information online about how much Social Security money you will receive, and benefits differ for individual circumstances, including spousal benefits, survivor benefits and disability insurance benefits.

It’s important to realize that Social Security benefits alone will likely not provide enough income to finance retirement. It is, however, a reliable source of income that will fit into your overall retirement plan. 

Another financial advantage to retirement is Medicare. At age 65, you become covered with this medical insurance, and the savings this brings to your monthly costs can be significant. Many helpful resources exist via online, by phone and in person to help you navigate and make use of your Medicare benefits.

Home Equity

IRA and 401(K) retirement accounts are known as working assets. They earn money for you over time with proper investment. But you may also have a large non-working asset; your home equity. You’ve likely been paying down your mortgage over many years while your home has increased in value. For many people, their home is their largest asset and best source of retirement income.

At age 62, you can take advantage of your home’s value by taking out a reverse mortgage. This is a loan against your home’s equity that you’ve earned over the years. Unlike a traditional mortgage, you don’t make monthly payments on the loan right away, which would increase your cost of living. The lending institution receives its payments when the home is sold.

A reverse mortgage can be a great way to supplement your retirement income from your investment assets and Social Security benefits. It isn’t for everyone, though, so discuss this option with your financial advisor and trusted family members before making a decision.

Considering a Senior Living Community

A lot of people think the cost of senior living communities is too high for them to afford, and out of reach for their retirement finances. But there are many cost-saving benefits to a senior living community that puts this possibility well within reach. Whether you consider independent living, assisted living, or continuing care, there are many ways in which a senior living community can help you save money. 

First, by downsizing your home, you save on housing expenses. Plus, you no longer have the expense of utilities or the headache of ongoing home repair and maintenance. Also, the amenities offered at a senior living community give you free access to activities that would otherwise cost you in transportation and entertainment. Social clubs, exercise classes, concerts, church services and so many other activities are offered on-site and at no expense.

Along with those cost savings, you get the added benefit of quality care services available to you right in your home. With many levels of care to choose from, you will be able to find just the right senior living community for you.

Quality of Life At Canterbury Court

With wonderful homes, expert care services and a long list of amenities, life at Canterbury Court in Atlanta, Georgia, is hard to beat. It also may be more affordable than you think. If you want to learn more about financing your retirement, contact us and let us help you, and see if Canterbury court could be the next place you call home.