Courtesy of ebay.com
Yesterday, I offered a few savings suggestions to pad your retirement account. (Blog 8/8/2016) Today, I’m going to recount a few ways to protect income after you’ve retired. Elizabeth O’Brien encourages us to plan for the unpredictable by setting aside money for emergencies and/or increasing insurance coverage.
As we age, we face greater medical costs, so buying Medigap insurance that extends benefits beyond basic Medicare is a benefit to consider. Her advice: “Plan F, the most comprehensive Medigap plan, covers Part A and Part B co-insurance and deductibles, along with other services.” “Retire,” by Elizabeth O’Brien, Money, August 2016, pg. 32.)
Unfortunately, not all medical expenses the elderly encounter are covered by insurance. Hearing aids cost $4-5000 a pair and need to be replaced after a few years. Glasses and eye exams, aren’t covered by Medicare. Dental care also isn’t covered. Crowns can cost $1500 each and a tooth implant will set you back $4000. To weather these storms an emergency fund is vital. O’Brien offers standard advice to seniors on a fixed income: Set aside 12 t o 18 months of living expenses. (Ibid pg. 32.)
A fixed income often requires you to penny pinch.. If you have a retirement account, keep a close eye on the fees and expenses you pay to maintain it. Vanguard funds have long been recommended by pundits because the service fees are low. But Vanguard has competitors these days. Schwab Total Stock Market is one option. According to Carla Fried, per $10,000 in investments, Schwab’s annual fees come to $9.00. For the same investment, Vanguard 500 charges $16. (“X-Ray: Vanguard 500 Index,” by Carla Fried, Money, August 2016, pg. 38.)
Money like water needs constant monitoring or it will disappear. No one cares about your health or your finances as much as you do. To be the master of your fate you have to steer the ship. No resting on your oars at any age.
(This blog first published 8/9/2016)
