As Generation X prepares for the final stages of retirement planning, it’s important to revisit their financial plans. Those born between 1965 and 1980 experienced the explosion of personal computers, so it’s no coincidence that technology plays a big part in planning for a secure future. People in this generation aren’t ready to slow down yet, but as the oldest reach the threshold for a ten-year window to retirement, it’s a good time to check balances and reconsider options. Adjust your plans for the changes you expect in the next decade with these five tips.
Consolidate banking accounts and investment funds
Most Gen Xers have multiple bank accounts and investments spread across multiple websites. As this generation opts out of receiving paper statements, you’ll need a record of existing accounts. As you get closer to retirement, consider consolidating accounts to one bank to reduce fees and maximize interest. Move all of your investment accounts to one institution to allow for a comprehensive portfolio evaluation. Organize a list of all accounts and institutions and pick someone trustworthy who can access the list in case of emergency. It’s not necessary to give anyone balances or access to the accounts, but documenting a list of existing accounts could keep the funds from being distributed to the state.
Have a plan for digital assets
Generation X will amass an extensive digital library of music, books, and movies over the course of their lives. Consider consolidating to one ecosystem, like a home-based media server, to keep them all in one place. Talk to a lawyer about how to include digital assets when you die, and document a list of automatically renewing digital subscriptions in a journal or spreadsheet. If you last earmarked budget amounts before smartphones became mainstream in 2007, it wouldn’t have occurred to you to budget for an expensive smartphone and data service. As you contemplate retirement, assume that new technology will impact your budget and plan accordingly.
Arrange for life insurance and budget for medical costs
As you navigate the road map toward retirement, make sure you have a plan for long-term medical care and life insurance. Medical costs will rise over time and as you age, so consider whether a long-term health policy is a good investment. It’s estimated that 60% of people in the US have life insurance, but at this stage, it’s time to research adding a personal policy for life insurance that isn’t employer dependent.
Make sure your budget accommodates rising transportation costs
The next ten years are shaping up to be transformational for vehicles. Controlling emissions to slow the effects of climate change is expected to raise transportation costs dramatically. Whether you drive a car or use public transportation, expect the costs to impact your bottom line. Make sure your retirement budget has room for an electric vehicle and in-home charging station. Auto insurance rates may increase as the cost of transportation escalates.
Consult a trusted tax & financial advisor
Generation X is in the home stretch for retirement planning. With no more than twenty years separating even the youngest from retirement, it’s a good time to re-evaluate your planning. The impacts of climate change and rapid changes in technology demand that Gen X check in on their accounts more often than previous generations. Ten years can serve up a lifetime of changes to your budget planning and may require you to pivot in a different direction. Creating an inventory of digital assets and consolidating bank and investment accounts can make it easier for your retirement and tax advisors to maximize your investments.