Ongoing changes in tax policy, the economy, and employment will affect your retirement—and the more you know, the better able you are to prepare. Here are three ways you can improve your retirement planning from BC’s Center for Retirement Research.
1. Take charge of your own retirement
This is especially true if you don’t have an employer doing it for you. More and more workers are relying on short-term jobs without benefits—the so-called “gig economy.” This puts the burden squarely on the individual’s shoulders to make a retirement plan and follow it.
Need help? Go online and try Curious Behaviors That Can Ruin Your Retirement, an interactive program that helps users spot ways they may be sabotaging their own retirement plans—and what to do instead. Explore it at bc.edu/curiousbehaviors.
2. Put your home to work
It’s one of your most important tools to increase retirement income. Downsizing to a smaller home can free up important assets, as long as tax implications and reinvestment are carefully considered. A reverse mortgage, which converts equity into monthly payments, can help eligible seniors stay in their homes. Home-sharing and renting unused rooms through sites like Airbnb have helped some creative seniors pay the bills.
The Center for Retirement Research’s booklet Using Your House for Income in Retirement examines downsizing and reverse mortgages with clear examples, includes the pros and cons of each approach, and provides links to online assessment tools. Find a free PDF at bc.edu/houseincome.
3. Get squared away
Ours is a rapidly changing world. We live longer, have children later, settle further away from our parents, and are more likely to experience life-changing events than previous generations. At the same time, the Great Recession (2007–2009) had a lasting impact on housing, the workplace, and the economy that researchers are still exploring. The result is a complicated landscape, making it more important than ever to understand the implications these changes will have on your finances.
Learn more on the CRR blog, Squared Away, which helps people better understand their behavior so they can act in their own best financial interest. It’s a one-stop way to keep up with news, research, and analysis on important issues that impact us all. Read it at squaredawayblog.bc.edu.