Retirement is an exciting time in every executive’s life, especially when they’ve put in dozens of years of hard work to earn it. Unfortunately, there’s a lot more than handing in your notice that goes into the retirement process. To ensure you can sit back and enjoy your golden retirement years with as little stress as possible, consider the following tips to make the transition easier.
Diversify Your Wealth and Investments
Senior-level executives typically accrue company stocks and equity options over the years. However, this often means most of a person’s investments are all in one place. As a general rule, investments should be as diverse as possible to minimize risks, especially during volatile economic times.
If you don’t want to invest any of your savings, sell several of your company’s stock that you already possess to free up funds. Then, invest in stocks in several different sectors to try to maximize your return and prevent any major losses.
Learn to Manage Deferred Compensation
Deferred compensation is a key source of income for retirees if a person plans accordingly years in advance. Most deferred compensation plans allow a retiree to choose between receiving a lump sum or annual payments spread out over the course of several years. The option you choose will have a significant impact on how much you pay in taxes.
A lump sum can push you into an entirely different tax bracket, making your tax payments higher. However, annual payments can keep you in a more ideal tax bracket while also providing a steady stream of reliable income.
Consider Purchasing Long-Term Care Insurance
Senior-level executives typically have their pick of several insurance plans provided by employers including health, life, vision, and dental insurance. While all of these are great to have and some are essential, it’s important to think towards the future.
Purchasing long-term care insurance provides ease of mind as a person gets older as it includes in-home aides, nursing homes, and covers costs for other assistance when a person is no longer able to care for themselves. These costs tend to be exceedingly high and can easily lead to debt. However, having long-term care insurance ensures you’re provided for no matter what.