The youngest Baby Boomers are approaching 60, while the oldest are halfway through their 70s. If you're on the tail-end of this generation, you're likely preparing to retire within the next decade. Some worry whether they'll never be able to really afford total retirement, and that's an important factor to consider as you start to reevaluate your finances. Future planning does not always mean following the typical path that was laid out for you.

As times change and the cost-of-living increases, many people are preparing to stay in the workforce well into their senior years. While there are actually some benefits to working as a senior citizen, it's a good idea to consider how you could leave the full-time workforce and embrace all that life has to offer in retirement.

Taking a close look at your income and making any necessary changes today can help you feel more confident about being able to afford retirement.

Take a Look at Your Life Insurance Policy

As an example, in the US a Life Insurance Retirement Plan (LIRP) uses its whole cash value to finance retirement expenses. You can use this to supplement income after you retire, and it may provide more than your 401(k)or IRA. This can also delay withdrawing early, giving you money to start investing in your future now without affecting how much money you receive in benefits in the future.

There are also ways to borrow on whole life insurance policies to finance things like a move or healthcare. You may even decide to sell your life insurance policy for a cash payout and buy another, less expensive one later on. Depending on how long you've been covered, selling your policy can provide you with a hefty lump sum of cash to serve as the foundation of your early retirement funds.

Reevaluate Your Taxes

Be strategic with your tax withdrawals to make the most out of each year's savings. Retirement accounts are all taxed differently, and you'll need to figure out how withdrawals could affect you and which one really works for your lifestyle. In the US, when you're 70 1/2, you'll have mandatory withdrawals each year. If you take out more than you're supposed to, you can face a 50 percent tax penalty.

Consider working with a financial advisor who specializes in retirement planning. They can help you set up all the right accounts to maximize your income, get a better return on investment, and ensure you don't miss out on any tax benefits or breaks. While you're still working, look for ways to reduce how much you pay and increase your return each year. Any savings you manage to earn can be put back into a retirement account or separate savings fund.

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Prioritize Your Lifestyle

Figuring out what you need versus what you want is important as soon as you're preparing to retire. Rather than immediately plunging into your bucket list, think about which experiences are most meaningful to you and how you can make them happen for the best price possible. In financial advising, distinguishing a client's needs in retirement from their wants is called creating a flooring income retirement strategy. Your monthly income, as well as any social security benefits, should be calculated prior to making any major changes.

You need to ensure that you'll always have enough income to keep a roof over your head, pay your bills, and eat well. While needs will change throughout retirement, setting up this foundation from the get-go will give you the greatest amount of financial freedom and personal security. If you intend to move and buy a new house for retirement, start planning ahead now. Investigate the market in the areas you're interested in, think about moving expenses and calculate your projected cost of living. This will ultimately impact how your income is dispersed later, and it can give you a better idea of how much you need to save and what types of compromises you'll need to make.

Consider Your Home's Equity

If you're a homeowner, you can turn your equity into retirement funds. One way is through a reverse mortgage, which allows you to take out a line of credit or take out money through lifetime annuity. In this case, you'll be able to keep your home throughout your senior years while earning money back on it. Some homeowners also choose to move for retirement and cash out on equity to finance the bulk of their financial stability. If you downsize, then there is the possibility of having money left in the bank. If you do decide to relocate, make sure that you buy a property you can age well in.

Don't Start Social Security Until You Need It

You can save by waiting to collect social security benefits until you're 67 or older. While this does give you a permanent monthly income, the lifetime value grows the longer you wait to start using it. If you're just planning for retirement, you already have a decade or more to continue putting money into your account. If you're able to comfortably do so, you may want to even consider increasing your monthly contribution. In the US, in 2021, the maximum earning for social security benefits is $142,800. You will have to pay $1,470 to earn one credit, and the full payout benefit is currently capped at age 70. After that point in time, your benefits won't generate any more value.

Plan Ahead for Medical Needs

It's impossible to predict what your healthcare needs will be in your 60s and 70s. While emergency funds are helpful, you should also consider how Medicare premiums and additional health coverages will also come into play. There are also things Medicare does not cover, like prescription medications, hearing aids and glasses. If you ever need living assistance or long-term care, you could be facing $150,000 to $300,000 in lifetime health expenses throughout retirement. Although you may enjoy wonderful health and have no medical problems, it's never a bad idea to be prepared. Explore your options, research how Medicare works and consider what healthcare coverage will cost you in the future.

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