The Importance of Early Retirement Planning

Most people would think of retirement when they are approaching the latter years of their life. They start saving up and possibly drafting wills and estate plans to secure a comfortable retirement and hope to leave behind a good legacy to loved ones. In this day and age when an increasing number of elders are living in nursing homes, there is much to consider. Most importantly, it is the significant cost of living in nursing homes nowadays.

A survey done in 2011 shows that about $239 is the average cost per day for a private nursing room. That average cost is projected to increase to about 4% to 5% each year, which is a significant cost in itself today and would be an overwhelming expense for folks who are planning their retirement for the next 20 to 30 years. Annual average cost is estimated at about $75,000. As opposed to what most people believe, health insurance will not pay for the expense of living in nursing homes, which leaves only the option to dedicate a portion of savings to retirement as early as possible in adult life. With taxes not making it easier for retirement and estate planning, people are advised to take action and prepare for retirement early in life.

Experts recommend taking advantage of an employer-sponsored 401(k) plan. Even small monthly contributions can add to a significant amount over the years. A 10% allocation or apportion of one’s salary to a retirement fund would also be able to help elders secure a better and more comfortable life in later years. Along the way, elders can increase that allocation and save more as they come close to their retirement years.

Many elderly folks save money and splurge on luxury cruise and vacation packages. As much as this can be fulfilling and gratifying, the amount spent on luxury can be allocated practically for retirement funds. The financial health of elders is at risk with more spending on entertainment and fun rather than practical comfort and ease. When financial and estates are at risk, it is good to get legal advice on how to go about a retirement plan. The investments must be secured, and the huge taxes involved therein can be avoided through legal assistance and planning. A good retirement planning lawyer can help you develop long-term goals that will secure your finances and estates, and achieve what you envision as an ideal setting for the future.