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Question for the Money Doctors

Question submitted on Feb 20, 2019.

Question

I am 65 years old and 3 months away from retirement. I will be getting a lump sum of 100,000.00. The only additional income is my pension from June - December and my social security from November - December. I need roughly 25,000.00 to clear debts and tie me over until social security. I do not want to invest all of this money. What options do I have? I also need to know how much to withhold for a pension of 1861.00 and social security of 1571.00. I will still need to pay for health insurance. Help and thanks.

Answer

Congratulations on your upcoming retirement.  I'm not sure why you don't want to invest any of the 100,000?  As long as your debts are paid, especially high interest loans or credit cards, then why not consider a money market or at least a savings account to earn some interest income.  The freedom of retirement comes with a requirement to prepare a budget for your retirement years.  Summarize your sources of income and then list your expenses, starting with "must have" expenses like food and health care.  You'll need to counsel with a CPA/PFS in your area to calculate what income taxes to expect with your retirement income sources.  Click here to find a CPA/PFS in your area.  Best of luck.


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