Retirement Planning Essentials: Key Considerations for 2024

Whether retirement is on the horizon or you're in your 20s and looking down the road, it's never too early or too late to plan for future retirement funds. Start with a vision of what you want. Do you want to retire early? Then you'll need to start that nest egg. Do You want to live in Paris? Investing in annuities might be the answer. Your goals are important to your plan. Financial planning goes into making your retirement a possibility. Knowing these elements allows you to successfully plan for and live a comfortable retirement lifestyle.

1. 401(k) plan and Retirement Accounts

Meeting with a financial advisor is will help you in evaluating your 401(k) plan, IRA, roth IRA or any retirement plan you have. If it's a 401(k), make sure you're taking full advantage of your employer matching contributions. If possible, strive to make your contribution limits.

Even if your investment strategy is on track to fund your retirement, consider that future inflation affects your buying potential. You'll need to factor in inflation with your retirement savings strategy.

When retirement planning, create a ​my​ Social Security Account on the Social Security website. It lets you know how much you've paid into Social Security. It also gives an estimate of what your retirement benefit will be. Additionally, it provides survivor benefits information. Knowing what your survivors will receive and any other social security benefits your family members will receive can help in planning how much life insurance you'll need when making retirement decisions.

2. Retirement Timetable

You should set a goal for when you want to retire. This allows you to effectively plan the steps you'll need to take in order to retire when planned. A retirement calculator can also help. It will enable you to review your retirement savings and calculate what future withdrawals you'll need yearly.

Once you've determined a retirement age and the income you'll need, you can budget to make this happen. If you're age 50 plus, you might find yourself playing catch-up, but you can easily adjust your retirement savings plan to meet your retirement goals.

3. Retirement Side Jobs

Not everyone wants to just stop working. You might decide to take on a side job for additional income when you retire. Consider choosing something that you've always had an interest in or that has flexible hours. For instance, retirees that enjoy woodworking can sell projects. Or, if you've always wanted to write, you might want to start a freelance writing career.

There are also part-time opportunities to consider such as driving for Uber or walking dogs. If you have expertise in an industry, there might be opportunities to teach part-time.

Regardless, working past retirement provides an opportunity to not only stay busy but to also add to your retirement income and keep from having to take large distributions from your retirement accounts.

4. Health Care and Retirement

Health care costs can hamper retirement. If you retire before age 65, you won't be eligible for Medicare, and you'll need to pay for full health insurance. You can use the Health Insurance Marketplace to buy a plan, but this is still an added expense. When planning for an early retirement, you need to factor health insurance costs into your budget.

As you age, there may also be health costs that insurance won't cover. For example, if you need home health care or companion services, these are added expenses. When retirement planning, be aware that these expenses might occur. One opportunity that shouldn't be overlooked when planning for health-related costs is long-term care insurance. If long-term care is needed, it can blow through your retirement savings quickly.

5. COVID-19 and Retirement

The fallout from COVID-19 can affect retirement planning. Those who lost jobs have dipped into their retirement savings. Some older workers were forced to retire early before having the retirement savings they needed.

But many U.S. workers are now delaying retirement because of COVID's effects on their incomes. They need to rethink their retirement plans and come up with new strategies. Consider whether you need to go back to the drawing board and reevaluate your strategy.