9 of the Best Retirement Locations in the US

This post 9 of the Best Retirement Locations in the US appeared first on Daily Reckoning.

Dear Rich Lifer,

When it comes to retirement destinations, you can find an endless number of lists ranking the best and worst spots to live out your golden years.

My take is it really depends on how you want your retirement to look.

Of course, you want to stretch your dollar as far as it will go, but you’re also not going to do it at the expense of losing friends and family.

A survey by Merrill Lynch and Age Wave, found that the top reason people move in retirement is to be closer to family.

So, if your kids and grandkids are living in Michigan and you have your eyes set on sunny Florida, you might not be renting that U-Haul so fast.

That said there are some key factors to consider when choosing where to live in retirement.

Two of the most common factors you should consider are cost of living and quality of life. Other factors to be weighed are:

  • Housing costs
  • Tax rates
  • Health care
  • Climate
  • Overall happiness of residents

As I said, the best place to retire will ultimately depend on the retiree but here are my top 9 destinations in the US.

Most of the cities on this list have a moderate to low cost of living, and all are located in states that exempt all or a portion of retirement income from taxes, with the exception of one.

Bella Vista, AR

Located in the northwest corner of Arkansas, 200 miles south of Kansas City, Bella Vista is a scenic town in the Ozarks.

The median home price is $171,000, 31% below the national median. Cost of living is 4% below the national average.

Pros: Good air quality, warm climate. Many lakes. Low crime rate. Good economy. Adequate doctors per capita. No state income tax on Social Security and up to $6,000 of other retirement income per person. No state estate or inheritance tax.

Cons: Not very walkable.

Delray Beach, FL

Delray Beach is a beach town with a population of 69,000, just north of Fort Lauderdale. Median home price is $205,000, 18% below the national median. Cost of living is 10% above the national average.

Pros: Abundant doctors per capita. Good air quality. Walkable and bikeable for the most part. Good economy. No state income or estate/inheritance tax.

Cons: Serious crime rate above the national average.

Clearwater, FL

Population 116,000 and wedged between the Gulf of Mexico and Tampa Bay, the sun is always shining in Clearwater. Median home price $211,000, 15% below the national median. Cost of living is 5% above the national average.

Pros: Good air quality. High number of doctors per capita. Highly bikeable, somewhat walkable. Strong economy. No state income tax or estate/inheritance tax.

Cons: Serious crime rate somewhat above the national average.

Pittsburgh, PA

Home of Carnegie Mellon University, University of Pittsburgh, Duquesne University, and Chatham University, Pittsburgh is clustered around three major rivers. The population is 303,000.

Median home price is $151,000, 39% below the national median. Cost of living is 6% below the national average.

Pros: High number of doctors per capita. Great for biking and walking. Strong volunteer community. Good economy. No state income tax on Social Security or most retirement income.

Cons: Cold winters. Poor air quality. Serious crime rate above the national average.

Rochester, NY

Home of the world-famous Mayo Clinic, with a population of 116,000 people, Rochester is about 85 miles southeast of Minneapolis.

Median home price is $221,000, 11% below the national median. Cost of living is 2% below the national average.

Pros: High ratio of doctors per capita. Good air quality. Low serious crime rate. Good economy. Very bikeable.

Cons: Cold winters. Not very walkable. State estate tax. State income tax imposed on all Social Security earnings and pension income.

Lawrence, KS

Lawrence is a college town, home of the University of Kansas and it has a population of 97,000 people. Median home price is $208,000, 17% below the national average. Cost of living is at the national average.

Pros: High rank on Milken Institute list of best cities for successful aging, adequate physicians per capita. Strong economy. Low crime rate. Good air quality. Very bikeable, somewhat walkable.

Cons: Cold winters, state income tax on Social Security earnings.

San Antonio, TX

Located in the south of Texas, San Antonio has a population of 1.5 million. Median home price is $176,000, 29% below the national median. And cost of living is 3% below the national average.

Pros: Good ratio of doctors per capita. Good air quality. Warm climate. Good economy. No state income tax, no state estate/inheritance tax. Somewhat bikeable. Big cultural scene.

Cons: Serious crime rate above the national average. Not easily walkable.

Palm Bay, FL

Population 114,000, Palm Bay is located 75 miles southeast of Orlando. The median home price is $178,000, 29% below the national median. Cost of living is 3% below the national average.

Pros: Sunshine. Good air quality. Ratio of doctors per capita above the national average. Good economy. No state income or state estate/inheritance tax.

Cons: Serious crime rate somewhat above the national average. Not easily walkable.

Savannah, GA

Savannah has a population of 146,000, it’s located 30 miles inland from the Atlantic Ocean and is a beautiful river city. The median home price is $135,000, 46% below the national average. Cost of living is 12% below the national average.

Pros: Mild winters. Good air quality. Enough physicians per capita. Good for walking and biking. Social Security plus up to $65,000 per person of retirement income exempt from state income tax. No state estate/inheritance tax.

Cons: Serious crime rate slightly above the national average. Flat economy.

There is a lot to consider when you are looking for a place to settle down.

Your family, finances, and personal taste will play a huge role in your decision, but it’s important to know what your options are.

If you are able, visiting some of these locations may be a good excuse for a vacation so you can “test retire” there for a week or two.

There is no “cookie cutter” answer. Just make sure wherever you find yourself, it’s a place you want to see yourself for some time to come.

To a richer life,

Nilus Mattive

Nilus Mattive

The post 9 of the Best Retirement Locations in the US appeared first on Daily Reckoning.

9 of the Smartest Retirement Destinations in the US

This post 9 of the Smartest Retirement Destinations in the US appeared first on Daily Reckoning.

When it comes to retirement destinations, you can find an endless number of lists ranking the best and worst spots to live out your golden years.

My take is it really depends on how you want your retirement to look.

Of course you want to stretch your dollar as far as it will go, but you’re also not going to do it at the expense of losing friends and family.

A survey by Merrill Lynch and Age Wave, found that the top reason people move in retirement is to be closer to family.

So, if your kids and grandkids are living in Michigan and you have your eyes set on sunny Florida, you might not be renting that U-Haul so fast.

That said there are some key factors to consider when choosing where to live in retirement.

Two of the most common factors you should consider are cost of living and quality of life. Other factors to be weighed are:

  • Housing costs
  • Tax rates
  • Health care
  • Climate
  • Overall happiness of residents

As I said, the best place to retire will ultimately depend on the retiree but here are my top 9 destinations in the US.

Most of the cities on this list have a moderate to low cost of living, and all are located in states that exempt all or a portion of retirement income from taxes, with the exception of one.

Bella Vista, AR

Located in the northwest corner of Arkansas, 200 miles south of Kansas City, Bella Vista is a scenic town in the Ozarks.

The median home price is $171,000, 31% below the national median. Cost of living is 4% below the national average.

Pros: Good air quality, warm climate. Many lakes. Low crime rate. Good economy. Adequate doctors per capita. No state income tax on Social Security and up to $6,000 of other retirement income per person. No state estate or inheritance tax.

Cons: Not very walkable.

Delray Beach, FL

Delray Beach is a beach town with a population of 69,000, just north of Fort Lauderdale. Median home price is $205,000, 18% below the national median. Cost of living is 10% above the national average.

Pros: Abundant doctors per capita. Good air quality. Walkable and bikeable for the most part. Good economy. No state income or estate/inheritance tax.

Cons: Serious crime rate above the national average.

Clearwater, FL

Population 116,000 and wedged between the Gulf of Mexico and Tampa Bay, the sun is always shining in Clearwater. Median home price $211,000, 15% below the national median. Cost of living is 5% above the national average.

Pros: Good air quality. High number of doctors per capita. Highly bikeable, somewhat walkable. Strong economy. No state income tax or estate/inheritance tax.

Cons: Serious crime rate somewhat above the national average.

Pittsburgh, PA

Home of Carnegie Mellon University, University of Pittsburgh, Duquesne University, and Chatham University, Pittsburgh is clustered around three major rivers. The population is 303,000.

Median home price is $151,000, 39% below the national median. Cost of living is 6% below the national average.

Pros: High number of doctors per capita. Great for biking and walking. Strong volunteer community. Good economy. No state income tax on Social Security or most retirement income.

Cons: Cold winters. Poor air quality. Serious crime rate above the national average.

Rochester, NY

Home of the world-famous Mayo Clinic, with a population of 116,000 people, Rochester is about 85 miles southeast of Minneapolis.

Median home price is $221,000, 11% below the national median. Cost of living is 2% below the national average.

Pros: High ratio of doctors per capita. Good air quality. Low serious crime rate. Good economy. Very bikeable.

Cons: Cold winters. Not very walkable. State estate tax. State income tax imposed on all Social Security earnings and pension income.

Lawrence, KS

Lawrence is a college town, home of the University of Kansas and it has a population of 97,000 people. Median home price is $208,000, 17% below the national average. Cost of living is at the national average.

Pros: High rank on Milken Institute list of best cities for successful aging, adequate physicians per capita. Strong economy. Low crime rate. Good air quality. Very bikeable, somewhat walkable.

Cons: Cold winters, state income tax on Social Security earnings.

San Antonio, TX

Located in the south of Texas, San Antonio has a population of 1.5 million. Median home price is $176,000, 29% below the national median. And cost of living is 3% below the national average.

Pros: Good ratio of doctors per capita. Good air quality. Warm climate. Good economy. No state income tax, no state estate/inheritance tax. Somewhat bikeable. Big cultural scene.

Cons: Serious crime rate above the national average. Not easily walkable.

Palm Bay, FL

Population 114,000, Palm Bay is located 75 miles southeast of Orlando. The median home price is $178,000, 29% below the national median. Cost of living is 3% below the national average.

Pros: Sunshine. Good air quality. Ratio of doctors per capita above the national average. Good economy. No state income or state estate/inheritance tax.

Cons: Serious crime rate somewhat above the national average. Not easily walkable.

Savannah, GA

Savannah has a population of 146,000, it’s located 30 miles inland from the Atlantic Ocean and is a beautiful river city. The median home price is $135,000, 46% below the national average. Cost of living is 12% below the national average.

Pros: Mild winters. Good air quality. Enough physicians per capita. Good for walking and biking. Social Security plus up to $65,000 per person of retirement income exempt from state income tax. No state estate/inheritance tax.

Cons: Serious crime rate slightly above the national average. Flat economy.

There is a lot to take into account when you are looking for a place to settle down.

Your family, finances, and personal taste will play a huge role in your decision, but it’s important to know what your options are.

If you are able, visiting some of these locations may be a good excuse for a vacation so you can “test retire” there for a week or two.

There is no “cookie cutter” answer. Just make sure wherever you find yourself, it’s a place you want to see yourself for some time to come.

To a richer life,

Nilus Mattive

Nilus Mattive

The post 9 of the Smartest Retirement Destinations in the US appeared first on Daily Reckoning.

Budgeting Tricks for Retirement

This post Budgeting Tricks for Retirement appeared first on Daily Reckoning.

Retirement is an exciting thing to look forward to, but it does come with its own set of challenges when it comes to preparing for this next step in life. Once you retire; most likely, you will have to live on a fixed income. This can be an adjustment for many people, but with the right frame of mind, you’ll be able to prepare for any unexpected expenses.

According to the U.S. Bureau of Labor Statistics, the average retired household has about 22% lower costs than the average working household and spends about $14,000 less per year. It also reports that the typical senior spends about $46,000 a year in retirement. Because the average retirement length in the country is 18 years, we can project that the typical retiree will need an $828,000 nest egg to pay the bills upon leaving the workforce.

I know these are big numbers, but not to fear. Let’s go through the major expenses you can expect to encounter in retirement so you are as prepared as possible!

1. Health Care

Health Care is often times a seniors greatest expense in retirement. You may even begin your retirement in good health, but develop medical issues later in life. You can expect your spending on healthcare to rise from the working average of $4,000 to the retiree average of $6,500.

Many retirees do qualify for Medicare; however, many fail to realize that Medicare is not completely free. Basic Medicare costs $135 a month. It’s also important to remember that Medicare doesn’t cover many additional medical expenses such as dental work, glasses, or hearing aids. You may also want to consider purchasing an additional plan for prescription drugs and supplemental healthcare.

Thankfully there are steps you can take to lower your healthcare spending! Consider a Medicare Advantage plan; an alternative to traditional Medicare, Medicare Advantage is an all-in-one health and drug plan, and it typically offers a wider range of coverage than original Medicare will give you. You can also opt for cheaper generic prescription drugs and review your plan each year so you can be sure you’re paying for the plan that best fits your life.

2. Housing

Housing is another of the largest expenses for retired people. A large percentage of seniors, around 80%, enter retirement mortgage free; however, spending on housing can come as a surprise to many retirees. As houses age, they tend to require more upkeep and repairs which leads to more spending on maintenance, as you may be unable to complete housing work on your own. Property taxes also have a tendency to rise over time, even if home values decrease.

You may want to consider downsizing in your retirement. A smaller house will ultimately cost less to maintain and result in a lower property tax bill and reduced homeowners insurance. Another option is to rent in your retirement; this will also help eliminate many of the expenses associated with homeownership, like property taxes, maintenance, and repairs.

3. Transportation

Transportation costs decline on average from about $10,000 per year for working people to around $7,500 annually among retirees. This happens because retired people no longer have to commute to work and tend to travel fewer miles. However, if you choose to keep your car in retirement, AAA estimates it costs $8,849 a year, on average to cover the cost of insurance, maintenance and repairs.

It may make more financial sense to sell your car in retirement if you’re only using it a few times a week. With the convenience of rideshare options and public transportation, it may be a great way to save some money to get rid of your car.

In addition, retirees often qualify for senior discounts on public transportation. For example, people age 65 and over qualify for discounted rates on public transportation in Boston, Washington and San Francisco. In the Philadelphia metro area, seniors are eligible to ride public transportation for free.

4. Food

At the end of the day, everyone needs to eat. Food costs for retirees are 23% less than for working people, usually because there are less mouths to feed, however you should still expect to spend around $483 a month, on average, for food expenses.

There are a ton of ways to keep food costs down in retirement. One of the best ways is to cut down on eating out. Restaurants tend to mark up prices by 300%, so if you do choose to dine out, make sure you are budgeting that out and taking advantage of early bird specials whenever possible.

Take advantage of your extra time by putting more effort into bargain and bulk shopping. It’s also important to make thorough shopping lists to avoid unnecessary spending once you’re in the store.

5. Entertainment

The last major area of spending in retirement is entertainment. Now that you aren’t working every day, you have a lot of extra time on your hands to fill. The average senior today spends $197 a month on leisure, but remember this does not include any extensive traveling.

There are tons of ways to cut costs on activities in retirement. Many museums, movie theaters, and national parks offer senior discounts. Check out your local senior center for free events or further discounts. You can also save money on these costs by volunteering. With some of your extra time, picking up volunteer work at a museum; for example, will often allow you free access to the space.

If you are a senior who wants to travel, make sure you are doing extensive research and budgeting. Consider traveling at off-peak times of year or exploring domestic locations. Additionally, it’s wise to plan big trips for the early part of your retirement when you are most financially and physically able to enjoy them the most.

I hope you found these expense breakdowns helpful! Planning financially for retirement can be stressful, but don’t forget all the good that comes with being prepared. You deserve to make the most of your retirement so start making your plans today.

To a richer life,

Nilus Mattive

Nilus Mattive

The post Budgeting Tricks for Retirement appeared first on Daily Reckoning.

9 of the Smartest Retirement Locations in the US

This post 9 of the Smartest Retirement Locations in the US appeared first on Daily Reckoning.

When it comes to retirement destinations, you can find an endless number of lists ranking the best and worst spots to live out your golden years.

My take is it really depends on how you want your retirement to look.

Of course you want to stretch your dollar as far as it will go, but you’re also not going to do it at the expense of losing friends and family.

A survey by Merrill Lynch and Age Wave, found that the top reason people move in retirement is to be closer to family.

So, if your kids and grandkids are living in Michigan and you have your eyes set on sunny Florida, you might not be renting that U-Haul so fast.

That said there are some key factors to consider when choosing where to live in retirement.

Two of the most common factors you should consider are cost of living and quality of life. Other factors to be weighed are:

  • Housing costs
  • Tax rates
  • Health care
  • Climate
  • Overall happiness of residents

As I said, the best place to retire will ultimately depend on the retiree but here are my top 9 destinations in the US.

Most of the cities on this list have a moderate to low cost of living, and all are located in states that exempt all or a portion of retirement income from taxes, with the exception of one.

Bella Vista, AR

Located in the northwest corner of Arkansas, 200 miles south of Kansas City, Bella Vista is a scenic town in the Ozarks.

The median home price is $171,000, 31% below the national median. Cost of living is 4% below the national average.

Pros: Good air quality, warm climate. Many lakes. Low crime rate. Good economy. Adequate doctors per capita. No state income tax on Social Security and up to $6,000 of other retirement income per person. No state estate or inheritance tax.

Cons: Not very walkable.

Delray Beach, FL

Delray Beach is a beach town with a population of 69,000, just north of Fort Lauderdale. Median home price is $205,000, 18% below the national median. Cost of living is 10% above the national average.

Pros: Abundant doctors per capita. Good air quality. Walkable and bikeable for the most part. Good economy. No state income or estate/inheritance tax.

Cons: Serious crime rate above the national average.

Clearwater, FL

Population 116,000 and wedged between the Gulf of Mexico and Tampa Bay, the sun is always shining in Clearwater. Median home price $211,000, 15% below the national median. Cost of living is 5% above the national average.

Pros: Good air quality. High number of doctors per capita. Highly bikeable, somewhat walkable. Strong economy. No state income tax or estate/inheritance tax.

Cons: Serious crime rate somewhat above the national average.

Pittsburgh, PA

Home of Carnegie Mellon University, University of Pittsburgh, Duquesne University, and Chatham University, Pittsburgh is clustered around three major rivers. The population is 303,000.

Median home price is $151,000, 39% below the national median. Cost of living is 6% below the national average.

Pros: High number of doctors per capita. Great for biking and walking. Strong volunteer community. Good economy. No state income tax on Social Security or most retirement income.

Cons: Cold winters. Poor air quality. Serious crime rate above the national average.

Rochester, NY

Home of the world-famous Mayo Clinic, with a population of 116,000 people, Rochester is about 85 miles southeast of Minneapolis.

Median home price is $221,000, 11% below the national median. Cost of living is 2% below the national average.

Pros: High ratio of doctors per capita. Good air quality. Low serious crime rate. Good economy. Very bikeable.

Cons: Cold winters. Not very walkable. State estate tax. State income tax imposed on all Social Security earnings and pension income.

Lawrence, KS

Lawrence is a college town, home of the University of Kansas and it has a population of 97,000 people. Median home price is $208,000, 17% below the national average. Cost of living is at the national average.

Pros: High rank on Milken Institute list of best cities for successful aging, adequate physicians per capita. Strong economy. Low crime rate. Good air quality. Very bikeable, somewhat walkable.

Cons: Cold winters, state income tax on Social Security earnings.

San Antonio, TX

Located in the south of Texas, San Antonio has a population of 1.5 million. Median home price is $176,000, 29% below the national median. And cost of living is 3% below the national average.

Pros: Good ratio of doctors per capita. Good air quality. Warm climate. Good economy. No state income tax, no state estate/inheritance tax. Somewhat bikeable. Big cultural scene.

Cons: Serious crime rate above the national average. Not easily walkable.

Palm Bay, FL

Population 114,000, Palm Bay is located 75 miles southeast of Orlando. The median home price is $178,000, 29% below the national median. Cost of living is 3% below the national average.

Pros: Sunshine. Good air quality. Ratio of doctors per capita above the national average. Good economy. No state income or state estate/inheritance tax.

Cons: Serious crime rate somewhat above the national average. Not easily walkable.

Savannah, GA

Savannah has a population of 146,000, it’s located 30 miles inland from the Atlantic Ocean and is a beautiful river city. The median home price is $135,000, 46% below the national average. Cost of living is 12% below the national average.

Pros: Mild winters. Good air quality. Enough physicians per capita. Good for walking and biking. Social Security plus up to $65,000 per person of retirement income exempt from state income tax. No state estate/inheritance tax.

Cons: Serious crime rate slightly above the national average. Flat economy.


There is a lot to take into account when you are looking for a place to settle down.

Your family, finances, and personal taste will play a huge role in your decision, but it’s important to know what your options are.

If you are able, visiting some of these locations may be a good excuse for a vacation so you can “test retire” there for a week or two.

There is no “cookie cutter” answer. Just make sure wherever you find yourself, it’s a place you want to see yourself for some time to come.

To a richer life,

Nilus Mattive

— Nilus Mattive
Editor, The Rich Life Roadmap

The post 9 of the Smartest Retirement Locations in the US appeared first on Daily Reckoning.

7 Retirement Sins You Don’t Want to Commit

This post 7 Retirement Sins You Don’t Want to Commit appeared first on Daily Reckoning.

In general, Americans are pretty fearful about retirement and it’s easy to see why.

So today I want to talk about seven different things that can totally derail anyone trying to work toward more financial stability in their golden years.

Retirement Planning Sin #1: Counting on Social Security, Pensions, and Other Traditional Plans

At this point, I’ve probably written a million words on the problems with our traditional retirement systems and you’re free to read my thoughts in past articles and interviews I’ve done over the years.

But just to recap:

  • Social Security is now taking in less than it pays out and is projected to do so every year going forward…
  • Without changes, the program’s trust fund will be exhausted in 15 years and only 75% of promised benefits will be paid out…
  • Many pension plans – both governmental and private – have been suffering from similar shortfalls and systemic problems…
  • A number of pension plans are already trying to go back on the promises they’ve made to retirees…
  • And while near-term retirees will probably be the least affected group, I wouldn’t treat any guarantee as sacred.

Now, it needs to be said: These are not just abstract concepts. I’m not saying these things for shock value.  These are real issues that impact a lot of people in my own life.

For example, my father has two different state retirement plans after working in various mental health facilities for four decades.

My mother-in-law receives her retirement income from a pension provided by Dupont, her life-long employer.

And even I have a small pension from more than a half decade working at Standard & Poor’s.

I hope all of our payments keep coming as they should. But I’m telling my father, my mother-in-law, and everyone else not to just blindly depend on it!

Instead, you should always be saving and investing somewhere else on the side… just as a fall-back plan. 

Retirement Planning Sin #2: Failing to Have a Budget

For about 15 years, I urged my mom to keep track of her spending so she would have a good understanding of what her cash flows looked like.

In response, she gave me all kinds of excuses. She didn’t have time. She already had a basic idea of what she was spending. That there was no possible way to even keep track between her credit cards, her check payments, and all the various cash transactions she was making.

Then she turned 66 and got serious about retiring.

Sure, she knew what all the big numbers looked like – property taxes, car payments, etc. But did she have any idea how much was being spent eating out with her friends? Or going overboard buying Christmas gifts for my daughter?

Not really. Without that knowledge it was going to be impossible for her to design a sustainable life on a very fixed income.

Now she’s actually retired and keeps better track of the money coming in and going out because she has to. But she could have been even better prepared… and probably saved a lot more money ahead of time… if she had started sooner.

So please, if you don’t currently have a budget… one that accounts for ALL your expenses… please get one up and running.

I do this in an excel spreadsheet for my own family and we meet at the end of every year to revisit things.

But the process can be as simple as a $1 notebook from the drug store. And all you have to do is write down how much you spent and on what – no matter what payment form you use.

Then, after a few months, add up the numbers and put them into basic categories. I think you’ll be surprised at the patterns you see… and where you might have room for additional savings.

One other thing – if you share your finances with anyone else, it’s absolutely crucial that you include them in this process and that you have open and honest discussions about how the money is getting spent.

Speaking of which, there’s one major expense you might NOT be factoring in. And that’s why the third deadly sin is

Retirement Planning Sin #3: Ignoring Inflation, Especially in Health Care Costs

I’m sure you understand the general concept of inflation and you already have a sense that today’s budget might look different ten years from now simply because of rising prices.

But perhaps no single expense is rising faster – or impacting more retirees – than soaring healthcare costs.

Every year, Fidelity takes a look at how much a typical 65-year-old couple will spend on out-of-pocket healthcare costs during retirement.

This year the number was an eye-popping $280,000.

Five years ago, the number was $220,000.

That’s a 27% surge in just half a decade!

What’s more, this is assuming you have traditional Medicare coverage. Plus it doesn’t include costs associated with nursing-home care.

And that’s where things get really scary.

Unless you’re essentially destitute and qualify for Medicaid – or you’ve already purchased long-term care insurance – medical treatment outside a hospital is going to be your cost to bear.

The total outlay depends on a number of factors, including your local area. But according to Senior Living, the national average for a semi-private nursing home runs $82,128 a year!

Look, I’m not trying to depress you here. But the reality is that 70% of us will need long-term care services at some point in our lives… and sometimes it happens sooner than we think. In fact, 40% of the Americans in long-term care are between the ages of 16 and 64.

So whether you consider long-term care insurance or you simply set aside a big chunk of money and hope for the best, you at least need to consider the huge impact that health care costs will have on your family during retirement.

You’re looking at a quarter of a million bare minimum. And another $100,000 a year if long-term care becomes necessary.

That could be enough to drain even a very well-prepared retiree.

Which is why you should also seriously explore how you can protect your income and assets before they get taken or disqualify you from Medicaid.

The rules vary from state to state, and they’re always changing, but at the bare minimum you want to start thinking about this at least five years before long-term care becomes a real possibility.

For example, if you have a second home or rental real estate, you might consider signing it over to a trustworthy heir before you end up signing it over to a nursing home.

And speaking of protecting your assets…

Retirement Planning Sin #4 Is Not Using Tax Shelters!   

It doesn’t matter if you’re 30 or 60 – you should be using tax-advantaged accounts for the vast majority of your saving and investing.

Obviously, choosing which particular accounts make the most sense is going to vary based on your individual circumstances. But in general I recommend using the following process:

First, contribute enough to any employer-sponsored plan to get the maximum match…

Second, if you’re self-employed – which includes people who merely have side businesses – also consider opening a Solo 401(k) plan…

And third, use IRA accounts – traditional and/or Roth varieties depending on your goals and tax situation – to sock away even more.

This is what I do personally, and the same thing I recommend to everyone else I talk to regardless of age or income.

Retirement Planning Sin #5: Not Having “A Post-Work Plan.”

A lot of people don’t think this really matters – especially if they’re still relatively far away from retirement.

Heck, how could NOT working be hard, right? I mean, most people figure waking up without anything to do is a great problem to have.

However, I know someone who retired – from a job she didn’t even like – and she found the transition to be VERY difficult.

So much so that she had to take a class at her local senior center titled “Every Day Is a Saturday.”

In what amounted to a support group, she witnessed countless other new retirees literally breaking down because they didn’t know how to handle their newfound freedom – including a 70-year-old heart surgeon who cried profusely!

Rather than figuring this out as you go, start thinking about it now… and always keep that budget in the back of your mind, too.

There are countless resources available to retirees – free classes (even college educations in some places!)… special exercise groups… volunteer opportunities… mentoring programs… the sky is literally the limit.

The key is envisioning your future before it arrives.

And on a similar note…

Retirement Planning Sin #6 Is Being Inflexible

We never have any idea how things are going to turn out – in investing or life. So all we can do is plan for the best and prepare for the unforeseen twists and turns.

If you have a very narrow vision of what your future looks like, and you’re unwilling to change course, you’re setting yourself up for potential disappointment.

Just consider the thousands of retirees who are now discovering whole new lives in foreign countries they had never thought of visiting ten years ago!

Am I saying you should have to move to Thailand to get a comfortable retirement? Of course not. I’m simply saying that we should try to find joy no matter what… and embrace the excitement of trying new things no matter our age or circumstances.

That’s the real secret to a long, healthy, and happy life.

Which brings me to our final retirement planning sin… perhaps the biggest of them all…

Retirement Planning Sin #7: Procrastinating!

I started saving in a 401(k) the very first paycheck I got and I have increased the amount I sock away at every possible opportunity ever since then.

Two decades in, I have quite a lot in the bank already. Meanwhile, most of my friends are still treating retirement as some far-off thing.

Sure, there might be another two decades to go for anyone in my age bracket. But time flies!

That’s something to remember no matter how old you are… no matter where you’re at in terms of your goals… and no matter how much money you currently have.

To a richer life,

Nilus Mattive

— Nilus Mattive
Editor, The Rich Life Roadmap

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