Retirement is an exciting chapter in most people's lives, but it takes loads of planning and preparation. When you're a decade away from retirement, now is the time to make any adjustments to your strategy to ensure you're on track.
While everyone's situation is different, there are three moves to make right now to give yourself the best shot at retiring comfortably.
1. Check your estimated Social Security benefit
Social Security is a significant source of income for millions of Americans. In fact, nearly one-quarter of workers expect their benefits to be their primary income source in retirement, according to a 2022 report from the Transamerica Center for Retirement Studies.
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If you're going to be relying on Social Security to any degree in retirement, it's wise to know approximately how much you can expect to receive.
Fortunately, it's possible to check your benefit amount well before you retire. If you receive paper statements in the mail, you should be able to see your estimated benefit amount there. Otherwise, you can check your statements online by creating a mySocialSecurity account.
From there, you can see an estimate of your future benefit amount based on your real earnings. Just keep in mind that if your income changes substantially between now and retirement, it could affect your future benefit amount.
2. Decide when you want to start taking benefits
One of the most important retirement decisions you'll need to make involves when to start taking Social Security.
Your estimated benefit amount assumes you'll file at your full retirement age (FRA) -- which is age 67 for anyone born in 1960 or later. But you can begin claiming as early as age 62 or hold off until after your FRA. By waiting until age 70, you'll collect your full benefit amount (as seen on your statements), plus a bonus of at least 24% per month.
There's no right or wrong answer here, but it's important to make this decision carefully. If your primary goal is to maximize your monthly income, you may be better off delaying benefits.
On the other hand, if you're planning to retire in your early 60s or don't necessarily need the extra income, you may choose to file early. Also, if you're facing health issues or don't expect to spend several decades in retirement, claiming early can sometimes help you make the most of your money.
3. Make sure healthcare is covered
Healthcare costs in retirement can be significant. In fact, the average 65-year-old couple in 2022 can expect to spend around $315,000 on out-of-pocket healthcare expenses in retirement, according to research from Fidelity.
While Medicare can help, it doesn't cover everything. Some of the things it doesn't cover include routine exams, dental care, and eye exams for prescription glasses. It also doesn't generally cover long-term care (such as nursing home expenses), which can cost tens of thousands of dollars per year.
Healthcare costs can be difficult to plan for, but budgeting for at least some of these expenses can save you loads of hassle down the road. You may consider signing up for long-term care insurance, for example, or opting for a Medicare Advantage plan that covers more than traditional Medicare.
Finally, you can't enroll in Medicare until you're 65 years old, so if you're planning on retiring before then, make sure you have another strategy for covering healthcare costs so you don't risk draining your savings on an unexpected expense.
Preparing for a secure retirement
A decade may seem like a long time to prepare for retirement. But the sooner you take these three steps, the easier it will be to transition into this next stage of life.
When you know how much you can depend on Social Security and have a plan for healthcare, you can rest easier knowing you're heading into retirement as prepared as possible.
