Retirement insurance and financial planning

Most of you have heard and all of you know that Social Security should not be your only nest egg. First of all, as have been covered yesterday, Social Security may not be around for everyone, definitely not in its current form.

That being said, it should have always been understood that Social Security is intended to supplement, not replace, the total financial resources needed by a worker at retirement. Social Security retirement benefits replace about 40 percent of an average wage earner’s income, less if the benefit is permanently reduced due to early retirement. The belief is that at retirement age your financial needs are reduced. The mortgage on your home is paid off or you downsize to a smaller home. Your children have left home and are independent or possibly providing assistance to you. You have no long term care health needs.

Ok, is this the reality for most retirees? How many are still paying a high mortgage? How many still have kids at home, grown or otherwise? Many financial planners suggest that 70–80 percent of an average wage earner’s income will be needed for a comfortable retirement. Our changed reality demands more advance planning for retirement than most people have realized.

Let us help you plan. Visit us at http://www.ythlaw.com/ for a free phone consultation. Feel free anytime to leave a comment.

Social Security Retirement Insurance

As we continue our discussion on elder law, let's turn to a subject most of us may be addressing at some time. Even with the controversy over whether social security will continue, at present it is still our current system. Therefore, we need to have some idea how our specific circumstances will be affected.

Social security benefit payments would be based on how much you earned during your working career. Higher lifetime earnings result in higher benefits. If there were some years when you did not work or had low earnings, your benefit amount will be lower than if you had worked steadily.

The full retirement age is 65 for people who were born before 1938. But because of longer life expectancies, the Social Security law was changed to gradually increase the full retirement age until it reaches age 67. This change affects people born in 1938 and later.

You can choose to receive your Social Security benefits before you attain your full retirement age. If you begin to receive Social Security retirement benefits before full retirement age, your monthly payments will be reduced. Once the full retirement age is 67, the permanent reduction if you retire at age 62 will be 30 percent. Nevertheless, there are many retirees who choose to take benefits as soon as possible at age 62 due solely to the fear that Social Security is not secure and that benefits may be reduced in the future.

More on social security tomorrow. Leave your comment here or contact us at http://www.ythlaw.com/ with your questions.