Katherine Hanadel of Ameriprise Financial Services in Pennington believes it’s important to be involved in your retirement planning at any age. She will present “Engaged Retirement: Helping You Plan for a New Retirement,” on Thursday, December 10, at 7 p.m. at the Princeton Public Library. To register for this free seminar, contact www.princetonsenior.org.

Among the topics Hanadel plans to cover are calculating the cost of your current lifestyle, figuring out how much is needed to retire in the lifestyle you envision, deciding among the investment vehicles available, analyzing risks, and planning for taxes.

She grew up in Tuckerton, where her mother worked in real estate and her father had a retail business. “I started with the bookkeeping early,” she said, “at 14 or 15. I sent out the bills.” She studied at Richard Stockton College.

Hanadel began her work as a financial advisor in 1994 and currently advises 50 clients in their retirement planning. She started with her own saving and investing. “I became interested in the process of looking at how much it costs to live how much you can save without suffering,” she said. She subsequently developed an interest in investment and long-term care insurance.

Starting early. People should be planning for saving all their lives, Hanadel says. “You never know when retirement is going to happen. If you’re lucky, it happens when you want to retire.”

How much? Ten percent of annual income is a good starting point for saving, Hanadel says. But that’s not necessarily enough.

“It’s not a bad thing to get to retirement and find you have too much money,” she says. “Ten percent is a good starting point, but 15 or 20 percent is better. Usually people have to start with 10, putting that away on a regular basis until they get used to it, then they can increase it.

Building equity. It’s wonderful to have a house and not have to worry about paying mortgages. But at the same time people retire and have huge equity in their homes. If you don’t have enough income, you can tap that equity in retirement with a reverse mortgage, “but then that means that once you leave that house, you have to sell it,” Hanadel says.

“Equity in a home is good, but it’s very illiquid. If you want to sell it, you can’t necessarily sell it when you need the money. If there is a lot of equity in the home at an estate sale, that can be a problem because people have to take less money when they sell it in order to get it sold fast.”

And estate taxes have to be paid within nine months.

What about healthcare? People should have savings for healthcare, but they also should have long-term care insurance, Hanadel says. Long-term care insurance will enable people to obtain care without having to liquidate assets.

When people need care as an older person, they often don’t need a nursing home. “They could get that care in an assisted living facility or even in their home,” she says. “But it’s very expensive. If they have long-term care insurance, that gives them the control because the long-term care insurance will provide them with someone who will assist them to put that all together.”

It also helps people assist their families, which is often involved. “You also should have savings set aside for healthcare issues,” she says. “Medicare will pay a lot but you can’t count on Medicare to pay for non-nursing care.

Are you engaged? Engaged retirement means being fully involved in planning. “A lot of people don’t have an idea of how much it costs them to live, or where that money goes,” Hanadel says. “It’s amazing how many people will spend everything they make and they don’t realize where it goes.”

What happens to these people in retirement is simple — they don’t have enough money and will find it difficult to make their money last.

If your money is not getting a return for you, you can’t keep up with inflation. And you’re going to live a long time on that income.

“A lot of people are going back to work,” she says. “That’s OK if that’s what you planned to do. Sometimes going to McDonalds or Walmart can be good, as it gets people out. But you should plan it ahead of time, be engaged in the planning process.

Paycheck to paycheck to retirement. A lot of people live on everything they bring home, and saving 10 percent is just not feasible. Hanadel advises anyone in this spot to start with pretax savings, even if they put $10 a day away.

“People can waste $10, $25 a day,” she says. To put that away each week or day, it’s amazing how that will add up. They’ll stop spending it because it won’t be there for them to spend.”

Of course, those people who have high expenses in life need to get control of these expenses. Or make more money, if they can.

For instance, if you are spending a lot of money on rent or mortgage, look at some place that doesn’t cost as much, or maybe refinance. “Or you could turn off the lights and not use as much electric. There are lots of ways you can save money once you start to look at it.”

Common areas of overspending. Everybody is different and that’s why it’s a good idea to keep track of what you spend, Hanadel says.

“There are various ways to track what you are spending money on and to find out what exactly you are wasting money on. People are amazed when they do this to find out where the money is going. Once they start seeing how that money can accumulate they are much more motivated.”

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