Every sane person wants to retire from working prior to the age of 65, and with enough money saved up to cover any expenses.
Recent stats indicate that the average total dollar value of the typical American household’s retirement savings are slightly more than $95,000. Unfortunately, according to recent forecasts of living expenses by Fidelity Investments, $95,000 is only a fraction of what the average United States household needs to reasonably afford unforeseen and unplanned expenses throughout a family’s golden years.
The average American household will incur $275,000 in average expenses, according to these statistics.
What Saving $275,000 Really Means For Your Future
David Giertz, formerly the Regional Vice President of Nationwide’s Southeastern division of the United States, including having the responsibility of President of Nationwide Financial Distributors, has over 30 years’ worth of success in the financial services realm.
As such, David is uniquely qualified to provide retirement planning and advice.
Something retirees often forget to include in their cost of retirement, says David Giertz, is the cost of healthcare expenditures. Both foreseen and emergency expenses, including that of long-term care insurance are oft overlooked. These are, by far, the most important things you should worry about in terms of financing your retirement. That includes whether you plan on resigning from your current job in the next few months, or don’t foresee retirement on the upcoming 10-year horizon.
Inform Yourself Of What Retirement Planning Consists Of
Let’s take two statistics into mind – hold on to them for a moment. 69% of people in excellent health have a “very good idea” of what the total cost of retirement will be. 49% of people in the same condition have “extreme confidence” they’ll have enough money to support a comfortable retirement.
From this we can surmise the average United States household only saves $95,000 for retirement. From that, 69% of people in excellent health – which is a fair portion of all Americans – believe they have a very good idea of what the upcoming expenses of retirement will hold. Therefore it’s entirely reasonable to assume that most people aren’t informed of the realities of retirement.
David Giertz believes it’s important for people to learn more about long-term care insurance and HSAs.
What Are Health Savings Accounts?
Here in the US, most employers work with individuals and their families in setting up various types of savings accounts. These include the 401(k) individual retirement account, the Roth IRA, and countless others. One of these accounts is the health savings account or HSA.
You must have a high-deductible health insurance plan in order to qualify for an HSA. The out-of-pocket maximum deductible is $6,450 for single persons, and $12,900 for families, in high-deductible plans. These amounts often change from year to year according to IRS guidelines.
Individuals maintain ownership of HSAs, as opposed to shared ownership with employers. You’ll be able to lug around your HSA to other employers an unlimited number of times. You can use the contents of HSAs for any eligible expenditures towards healthcare costs.
HSAs offer three tax benefits to you and anybody else on your tax return:
- No taxes incurred on money added to HSA accounts.
- Interest is not taxed in an HSA, unlike other securities, bonds, or other financial assets.
- Lastly, eligible expenses are not taxed.
Long-Term Care Insurance
These policies provide full financial coverage if you find yourself with a disease or ailment that requires intensive care over long periods of time. They cost a few thousand dollars per year on average, although younger individuals get them at a discount. As such, buy one as early as you can, but be careful not to miss any payments.
Learn more from David Giertz by following him on social media, include his official Twitter @David_Giertz