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59 1/2: Not quite ready to cross the finish line

What now? If the tally of your retirement savings leaves you feeling a bit queasy about the future, focus on these solutions:

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Pay off your mortgage. Living well on a limited income after retirement is more doable if you can keep Uncle Sam out of your pockets. Once you and your spouse start collecting Social Security, you'll owe taxes on it if a combination of income and half of your benefits is greater than $32,000 for a couple filing jointly, or $25,000 for a single filer. Keeping your need for income below that threshold is much easier if you don't have a mortgage, points out Jim Thomas, a CPA based in Detroit.

Consider buying long-term care insurance before you get any older because costs increase as you age. Consumer Reports estimates that a plan that costs a 50-year-old $1,625 annually will run a 60-year-old $3,100 and a 70-year-old $7,575.

Save more money. Unless you're Bill Gates, there's no such thing as too much money. The more you save, the more you'll have. With retirement so close, now's the time to tighten your belt and sock away the cash.

Learn to manage your money better. Investing is a lot like playing poker; you can learn to be good at it. Better Investing, an organization of investment clubs, provides excellent tools and low-risk strategies for people striving to increase their investment knowledge and raise the return on their savings.

 
-- Posted: July 22, 2005
   

 

 
 

 

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