What You Need to Know About Retirement Planning

Tackling Retirement Planning

When planning for retirement, it is essential to understand the costs involved. This includes everything from healthcare expenses to transitioning into a new continuing care retirement community. By using a retirement fund distribution calculator, you can plan for your retirement efficiently and determine what your next step should be.

Read on to explore the different costs associated with retirement and how to plan financially as a soon-to-be retiree.

Are You Ready for Retirement?

If you are considering retirement, you may question whether it is the right choice for your lifestyle. After all, it is a significant life change, and we understand that these types of decisions cannot be made on a whim.

Choosing to downsize and transition into a retirement community does not mean you must leave your current lifestyle in the dust. Several life plan communities, such as Seafields, feature a host of luxury amenities, including fine dining, state-of-the-art wellness facilities, and easy access to nature.

These are just a few of the many amenities available in our community. Discover all the exclusive luxury offerings at Seafields here.

Whether you decide to move into a senior living community immediately after retiring or give it a few years, most offer a wide array of activities so that you can maintain a similar, if not enhanced, lifestyle filled with relaxation. Additionally, community events and workshops will allow you to brush up on your current interests and learn something new.

Understanding a Retirement Fund Distribution Calculator

When it comes to checking retirement readiness, a retirement fund distribution calculator is an excellent place to start. These calculators typically work by considering your savings accounts, retirement income, and any other expected withdrawals and deposits.

Retirement Income

When looking at retirement and income, the average retirement income for a retiree is around $27,000 per year. It is important to note that your income can vary greatly according to your age since older retirees earn less. Generally, you should save at least 70% of your income before retirement to compensate for any loss of income during retirement.

Your monthly expenses and savings should be calculated based on your monthly income. The next step is to determine how much of the income will be subject to tax. It is essential that you check your state’s specific tax rate, especially if you live in a high-tax state. For example, South Carolina does not tax social security or retirement plans and only partially taxes withdrawals from retirement accounts. In addition to having one of the lowest state tax rates in the country, the Palmetto State is one of the most tax-friendly states for retirees in the country.

Retirement Savings

In addition to your HSA and IRA, you should focus on saving a specific amount of money pre-tax each month. Depending on when you start saving, this may vary. For example, consider saving one to one and a half times your income for retirement by age 35. However, if you are 60 years of age, you should have between six and eleven times your annual income saved.

Expected Withdrawals and Deposits

When it comes to withdrawals and deposits, it’s important to understand the rules for specific accounts and be prepared for the possible rising costs of healthcare. Generally, contributions to retirement accounts may be made pre-tax, such as to a 401(k) or an individual retirement account. Roth IRAs and 401(k)s allow contributions after taxes have been deducted; however, contributions and earnings can be withdrawn tax-free after age 59 and a half upon retirement.

Additional Considerations

In addition to considering the rising costs of healthcare, you should also consider inflation. Understanding what kind of costs to expect from future appointments and diagnoses is essential. Keep in mind the location of your retirement as well as your tax rate when calculating the actual cost. The tax regimes in each state differ, which has a significant impact on your social security benefits.

Regardless of the circumstances, inflation should always be factored in. Due to the rising costs of healthcare and inflation, it is a good idea to learn about the various factors that can help you save some money for the future. If you keep all of these things in mind, you should be well-prepared to begin your retirement journey.

Embark on Your Retirement Journey at Seafields

A comprehensive approach to retirement preparation is essential. As a retiree, worrying about medical expenses and other expenditures should not be one of your concerns. Given the time-consuming maintenance aspect of aging in place, mortgages, and other monetary requirements, an independent living community can alleviate some of the stress associated with homeownership and allow you to pursue your passions.

At Seafields, you will find a variety of CCRC advantages to make your transition into retirement as seamless as possible. The Life Plan Community features a resort-style heated pool, bistro-style dining, and various wellness and recreational facilities.

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This post was originally published in November 2022 and refreshed in January 2025.