LOOKING AHEAD

LOOKING AHEAD


The decade before retirement is a good time to take
inventory of assets and obligations and make financial choices
aimed at maximizing future resources. These years are typically
a peak earning period and they offer the chance to reduce major
debts, such as a home mortgage, and increase savings and
income-producing investments. Households faring the combined
expenses of educating children and caring for aging parents may
find saving difficult during pre-retirement years. In these
cases, making a realistic financial appraisal is more useful.
These are questions you might ask yourselves:

* What are our sources of retirement income and how much
will each provide-monthly or in a lump sum?

* Social Security

* Pensions, IRAs, Keoghs

* Savings and investments

* Sale of assets

* Home equity

Find out all the options for receiving your pension
benefits and whether they are insured. Find out if pension
benefits will be reduced if you receive Social Security. Read
carefully and consider the consequences of signing any
documents relating to a reduction in spousal pension benefits.
One of you may need this income if the other dies.

When estimating how much income can be expected from these
and other sources, remember to take inflation, taxes, and
market fluctuations into account. Depending on your anticipated
income potential, you may decide to postpone retirement a few
years, or plan to work part-time.

* Is our health insurance adequate for retirement?

The cost of serious or long-term illness is a major burden
for many older Americans because Medicare does not cover all
health care costs. If you consider buying "medigap" insurance
to supplement Medicare, shop carefully for a policy that
supplements rather than duplicates Medicare coverage. Long-term
health insurance for nursing home or home health care is new.
Examine all the terms of any such policy before you buy.