SOCIAL SECURITY, MEDICARE, HEALTH AND LTC NEEDS
01.Core Concepts
• For many retirees, Social Security and Medicare will form the bedrock of their retirement plans. • Two big decisions for those on the cusp of retirement are: • Age to begin receiving Social Security income • Form of Medicare to select • Traditional (with or without a supplement policy) • Medicare Advantage plan • One of the largest unknowns for retirees is future health costs. • Medical premiums, coinsurance and out-of-pocket expenses • Costs not covered by insurance • Potential need for Long-term care coverage ASSET ALLOCATION • Asset allocation adjustments may be needed prior to and during the income and distribution phase of retirement. • During the accumulation phase • Allocation may have been set for automatic rebalancing • Set to a suitable risk tolerance for the client • Preparing for the distribution phase • Shift assets from a growth model to growth, income and capital preservation • Differing spousal risk tolerances • May come from a large age gap or personal feelings on risk • Assess both spouses using a risk tolerance assessment