Retirement Planning Tips

10 – 20 Years from Retirement

Set up your myMERS Account and use the Financial Fitness Tool

Your myMERS account offers one-stop access to view your MERS plan information, add or change plan beneficiaries, make investment changes, update your contact information and much more. It also offers Financial Fitness – a customized tool that allows you to create financial goals and track your progress, add financial accounts from others sources to help you build and stick to a budget, manage debt and more. Setting up your account is easy and the best way to manage your MERS retirement account(s).

Manage Debt

It is not unusual for people in this phase of life to have debt – whether it’s a mortgage, car payment, credit cards or a combination of those things. The most important thing is to have a plan to pay it off. Use your budget to determine how much you can afford to put toward your debt payments each month, and see if there are any areas you can reduce expenses to accelerate debt payoff.

Check out more tips to manage and eliminate debt here and here.

Continue to Build an Emergency Savings Fund

An emergency fund is money that’s been set aside to cover any of life’s unexpected events. This money will allow you to live comfortably for a few months should you happen to lose your job or if something unexpected comes up that will cost a fair chunk of money to cover.

Check out more tips to build your emergency fund here.

Designate and Keep your Beneficiaries Current

You may have designated beneficiaries for your retirement accounts, life insurance policies, and similar assets when you opened your account(s), or you may not have. To ensure that your assets will be distributed as you intend, double check to ensure you’ve made those designations and periodically review them to make sure they are current and correct.

For more information on adding or updating beneficiaries to your MERS plan(s), click here.

Create an Estate Plan

It’s difficult to think about, but the day will come when you pass and your loved ones will be responsible for dealing with and dividing up your possessions. One way you can make this sad time a little easier is to have an estate plan on file.

An ideal estate plan describes your wishes as clearly and completely as possible. This helps others know your requests in the event you’re incapacitated or you pass away. You may even need several types of documents to cover all your bases.

  • will provides the most widely recognized tool for expressing your final wishes.
  • An advance care directive is a formal name for a living will. You can use one to specify the course of your medical treatment at times when you can’t make choices for yourself.
  • health care proxy lets you designate someone to make choices about your medical care when you are unable to do so.
  • Statements of intent allow you to layout your philosophy and preferences for the guardians and trustees who will be asked to carry out your wishes.

For more information on creating an estate plan, check out this CentsAbility article and this Quick Bite Webinar.

Start Thinking About Retiree Health Care

Sooner is better than later when it comes to planning for retiree health care coverage. You may be happy with the health care coverage you currently receive through your employer, but will that coverage continue after you retire? Even if your spouse’s employer provides retiree health coverage, you will still have to pay a variety of out-of-pocket costs — deductibles, copayments, and part of the total premiums.

Keep Retirement Accounts Invested – Even if You Change Employers

When you switch employers, it may be tempting to cash out any money you’ve accrued in your retirement accounts. But by doing so, you risk losing a substantial amount to taxes and penalties. Don’t lose out on your hard-earned retirement savings! Instead, consider consolidating your accounts by rolling over funds into your new employer’s plan. Doing so can have big benefits such as:

  • Convenience – Consolidating your retirement savings under one plan makes it easier to track your investments and manage your account.
  • Account growth – MERS’ low average investment fees mean more of your money stays invested in your account.
  • Investment options –MERS provides you with access to select investment funds that aren’t available to the public.
  • Tax benefits – You do not have to pay any income tax on the amount you roll over. Your money will keep the same tax advantages of the account you are transferring it from (pre-tax or Roth).
  • Access – Rolling over your account doesn’t restrict your options; any balance transferred from your previous account will remain available for you to withdraw according to the terms of your original plan.

Interested in learning more about how you can roll funds into a MERS plan? You can find more information here.

Prioritize Retirement Savings

Many parents want to save money for their children’s education. However, if you’re contributing to a college fund rather than a retirement account, you might be putting your own future in jeopardy. There are various options to help your child(ren) pay for college such as student loans, scholarships, grants and work-study jobs. You don’t have the same options available to cover your retirement.

Most importantly, by prioritizing your retirement, you are less likely to be a burden on your child(ren) one day because you can’t afford other care options.
Start having the conversation with your child(ren) now and set the expectations for what amount you can help pay.

Review Retirement Plan Details with Your Spouse

In retirement you may be replacing two incomes, not just one – so it’s important that you’re both working toward the retirement goal.

After setting aside enough money so that each of you gets the employer match, if any, compare the menu of investment options, fees and any advantageous features of other available programs such as a MERS IRA to decide how you and your spouse should allocate your income.

If either of you have a pension, have you talked through payment options at retirement?