Retirement Blunders To Avoid

If you want your retirement to be as comfy and secure as possible, avoid these mistakes:

• Assuming Social Security will be enough: The average monthly retirement benefit was recently $1,523. That’s a little more than $18,000 per year, and many people will receive much less than that. To learn how much you can expect from Social Security based on your earnings so far, visit SSA.gov and set up a “my Social Security” account. Then develop a plan to build any additional income you’ll need through saving and investing.

• Not signing up for Medicare on time: If you’re late enrolling in Medicare, you can be slapped with a hefty penalty fee. You’re eligible for Medicare at age 65, and you can sign up anytime within the three months leading up to your 65th birthday, during the month of your birthday or within the three months that follow. Visit Medicare.gov for more info.

• Failing to take required minimum distributions (RMDs) on time: Owners of traditional IRAs and 401(k)s (though not Roth IRAs) are required to withdraw a minimum amount each year — for new retirees, beginning the year you turn 72 — and missing the deadline can be extremely costly. (RMDs were waived for 2020 due to the pandemic.) For more on RMD rules, visit AARP.com and type “RMD” into the search box there.

• Not considering fixed annuities: Variable or indexed annuities can be problematic, with steep fees and restrictive terms, but fixed annuities (immediate or deferred ones) are more straightforward. They offer dependable income for a set period — which can be the rest of your life.

• Underestimating the cost of health care: It’s been estimated that married retirees will spend hundreds of thousands of dollars out of pocket on health care during their retirement. Aim to keep your costs down by staying healthy and being smart about Medicare, choosing the plan that will serve you best and making the most of all it offers, such as free cancer screenings.