The end of summer closes the books on nearly three-quarters of 2024 — but if you’re a retiree or near-retiree, your actions and inactions over the next few months could determine your success in 2025 and beyond.
Find Out: 2 Changes Are Coming to Social Security in 2025
Up Next: 7 Reasons You Shouldn’t Retire Before Speaking To a Financial Advisor
GOBankingRates spoke to experts who outlined the money moves that older Americans should make before the arrival of fall to prepare for the year’s crucial closing quarter. Don’t let the weather turn with these financial loose ends still untied.
Earning passive income doesn’t need to be difficult. You can start this week.
Budget For the Season of Spending — and Everyday Life in 2025
For most people, fall signals the beginning of the most expensive time of year, when the holidays, the busy travel season and the runup to tax time cram their combined money stress into just three short months.
Retirees on fixed incomes need to plan for those near-term realities — but they should also use the movement to revisit their budgets and revise their spending plans for when the dust settles and 2025 arrives.
“Plan for the costs of daily living,” said Dalton Tigner, founder and CEO of Tigner Financial, a family business founded in 1992, where he’s spent more than 30 years helping retirees plan for the future. “Most retirees vastly underestimate their expenses in retirement. Budget realistically for costs like housing, transportation, food and entertainment.”
Learn More: Cutting Expenses for Retirement? Here’s the No. 1 Thing To Get Rid of First
Revisit Your Insurance Policies, Premiums and Payments
Comprehensive retirement planning requires sufficient but not excessive insurance coverage. Now is the time to look over your policies, eliminate redundant or unnecessary coverage and shop around for lower premiums before your carriers launch their traditional fall and winter enrollment periods.
“Review your insurance coverage and adjust as needed,” said Tigner. “Many retirees let policies lapse or carry inappropriate amounts of coverage. Reevaluate life insurance, health insurance, property insurance and long-term care insurance to make sure you have the right coverage at the best price.”
Stuff Every Possible Dollar Into Tax-Advantaged Accounts
If you’re on deck to retire and haven’t yet maxed out your retirement fund, the time to catch up is when the tax year winds down. Your nest egg will thank you when you finally take the plunge.
“As a 40-year veteran of tax law and financial planning, I strongly advise retirees to review and maximize contributions to retirement accounts before year-end,” said David Fritch, CPA, founder of Elite Tax Strategy Solutions and a former 20-year Registered Series 6 and Series 7 investment advisor. “The additional catchup amounts for those over 50 provide significant returns over time.”
For 2024, the IRS allows older savers to stuff an extra $7,500 into their 401(k)s and 403(b)s, and an extra $1,000 into their traditional or Roth IRAs.
Reconsider Your Asset Allocation
Catchup contributions can help build healthy retirement funds, but if your nest egg holds investments that are too aggressive, too risky or otherwise misaligned with your age and goals, the egg you spent all those years growing can break when you need it most.
“Ensure your portfolio matches your income needs,” said Fitch. “Many have unsuitable allocations years into retirement.”
Brush Up on the Many Scams Aimed Just at You
Seniors remain a primary target for scammers, identity thieves, regular thieves and fraudsters of all stripes. They operate in both the digital space and the real world and are always changing tactics. To avoid becoming a victim, visit sites like the Justice Department’s Elder Justice Initiative Senior Scam Alert page and other reputable sources for up-to-date information on both familiar and emerging frauds targeting retirees specifically.
“Don’t fall for scams,” said Les Perlson of NPA Benefits, an expert in retirement and late-life insurance coverage. “Retirees are frequent targets, so be wary of unsolicited calls, emails or mail promising free money, inheritance or investment opportunities. Reputable companies don’t ask for fees or payments upfront for services. When in doubt, verify offers independently before providing personal information or sending money.”
More From GOBankingRates
This article originally appeared on GOBankingRates.com: 5 Money Moves Retirees Need To Make Ahead of Fall 2024
Source Agencies
