Retirement is a time in which you would expect a decline in busy day-to-day activities and an easier daily routine funded by your hard-earned savings and retirement plan. This is a time to reap the reward for your hard work. You can achieve this through travel, leisure, hobbies, etc. Unfortunately, there are life events that can arise and affect your financial resources, lifestyle, and peace of mind. Below are 3 unique life events that can pop up during this time.
1. Loss of income
Loss of income is a problem for a lot of retirees who go into this next stage of their lives, as the standard of living can change after leaving the workforce. Refinancing your home mortgage at longer repayment terms (like from 15 to 30 years) can alleviate your monthly payments and reinforce your cash reserves. It would also be wise to plan to have six months’ worth of living expenses in the bank as a backup plan.
2. Divorce
Prenuptial agreements provide the best protection for your retirement by defining and setting aside assets not jointly owned, and thus not at risk of divorce despite the immense foresight required. Non-contested divisions of assets usually hail easier process outcomes as both sides agree concerning the fair distribution of the assets. Therefore, getting professional legal help is required as well as financial who specialize in divorce is essential.
3. Illness and death of a spouse
Health insurance helps to deal with events of catastrophic illness, especially during the retirement period, which is often when these problems most likely arise due to you reaching your golden years, which can affect your retirement savings. Medical expenses caused a high percentage of bankruptcy around the world. Disability insurance caters to your financial needs, helping secure your lifestyle should you become disabled and stop working.
Life insurance is important. It offers coverage for funeral expenses which can add up over time and, if not monitored, can leave the family with a dent in their fixed income. Living near medical facilities reduces the cost of transportation, in-home services, and therapy.
Similar Article: The 6 Most Important Emotional Stages During Retirement
Summary
Life events can upset the balance of your existing retirement plans. Preparations help mitigate their effects. However, there are still ways to salvage enjoyment and financial comfort in your retirement years through smart and timely decisions.
