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Financial Planning for Seniors

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Strategies to Secure Your Financial Future

Choices and challenges related to finances affect our lives at every age and every stage. For older adults, financial health is just as important to daily life as mental, physical and emotional health. Priorities, concerns and plans often change as adults enter the golden years of life, making finances a key part of building a life they love.

Taking the time to understand how financial planning for seniors is different than at other stages of life, examining financial goals and making a plan to achieve those goals is a great way to achieve the ideal retirement lifestyle!

Seniors and Finances

There are some special factors to take into consideration when thinking about seniors and finances. Health care costs are likely different, needs for monthly spending may have changed and retirement planning is a much more immediate concern that it was several decades before. While there is a lot to keep in mind, here are five key factors to creating a successful plan for senior money management:

Goal setting.

Considering all aspects of life – from health care needs to living costs and family relationships – what does the ideal retirement lifestyle look like? What is the perfect retirement age? What new costs need to be factored in after retirement? Travel? New hobbies? Continuing education? When will Social Security benefits start?

Long- and short-term planning.

In addition to the present state, it is important to think about future possibilities. Detailed planning and smart strategies based on current and future goals is a great way to stay on track. A retirement calculator can be a good place to start.

Set a budget.

Financial planning for seniors includes creating a spending plan, especially after retirement when a fixed income is in play. Without a budget, it becomes easy to spend too much too early during retirement and get into financial trouble.

Know where to find help.

Financial planning for seniors can not only feel like a daunting task, but it can be a major source of stress for some adults. Finding senior financial help is often the best way to stay on track financially, to protect assets and to give the senior and their family peace of mind. Trusted relatives and licensed financial professionals are good places to look for assistance.

Avoid scams.

Unfortunately, seniors are often the targets of financial scams and online scammers. To help protect their monthly cash flow and their retirement savings, seniors should take the following steps:

  • Work with a licensed financial advisor
  • Entrust a loved one with access to financial accounts in case of emergency
  • Use unique passwords for all online accounts
  • Have more than one financial account
  • Do not share financial information over the phone after an incoming call; always call the number listed on account information to discuss financial matters
  • Never share personal information, like a Social Security number, over the phone after an incoming call
  • Get the details of financial decisions and changes in writing and keep for future records
  • Check credit reports once per year
  • Enroll to receive notifications on all accounts and credit cards when activity takes place

How to Plan for Retirement

While the average American spends at least 20 years in retirement, it is still common for adults to put off retirement planning. 

The term “retirement planning” refers to the process an individual puts in place to maintain their finances after leaving the workforce. Retirement planning has five basic steps: knowing when to start, calculating how much money will be needed, setting priorities, choosing accounts and choosing investments.

Generally, the idea is to invest more aggressively as a young working person, and then slowly dial back to a more conservative mix of investments as retirement age approaches. In the early years of working, building a nest egg is important. Here are a few ways to do that:

  • Create a savings plan and stick to it
  • Have an understanding of what retirement needs will be
  • Contribute to an employer’s retirement savings plans when possible
  • Learn about an employer’s pension plan if one exists
  • Learn about basic investment principles
  • Do not dip into retirement savings until retirement

However, it is never too late to start financial planning for seniors! Here are a few ideas to try leading up to and after retirement to build a secure financial future:

  • Downsize or streamline expenses. Letting go of an expensive home and varied monthly bills can be a relief during retirement. Many seniors move to a senior living community to combine expenses into one and let go of maintenance costs.
  • Explore senior discounts on goods, services, travel and more!
  • Make monthly money management easier by enrolling into automatic bill pay programs
  • Lower auto insurance by reporting no daily commute as a retiree, or give up the car altogether in favor of senior transportation options
  • Restrict credit card spending to reduce the potential for fraud and to maintain budget awareness
  • Avoid costly withdrawals from retirement accounts in emergencies by maintaining a traditional savings account

About Mount Prospect Senior Living

At Mount Prospect Senior Living, we want our community to feel like home. Mount Prospect is designed to meet the needs and wants of active, engaged seniors. Our team utilizes the Vibrant Life® program to allow residents to use creativity and personal preferences to create their day in any way they like. The program challenges and inspires residents, encouraging new adventures and making suggestions based on individual interests and physical abilities. We offer assisted living and memory care apartments to fit every need, and our team is here to help you make your new space into a new home!

At Mount Prospect, we would love to invite you and your family to visit our community and learn more about our programs, our culture and our care. Have questions before you make the trip? Call us at 847-250-6029 today — we are happy to answer any questions you have!