Financial Planning in Your 70s: 7 Smart Tips to Preserve Your Retirement

Your 70s can bring major financial and lifestyle shifts. Changes in life priorities, income, health care needs, and taxes will be important to address, whether you’re still working, retired, or somewhere in between. With people living longer and financial and retirement rules continuing to evolve, staying engaged and updating your financial plan remain important. These seven tips highlight key areas to focus on to help you stay financially prepared in your 70s and beyond.  

1) Be Proactive About Your Health and Long-Term Care

Health-related costs may be one of your biggest expenses as you age, and the cost of long-term care is expected to keep rising. Planning proactively can’t eliminate the costs but can help you plan for the supports you may need to live comfortably as your needs change with age. Even if you're healthy and living a lifestyle you've enjoyed for years, there is still the chance that a major illness could set you or your loved one back.

By now your healthcare proxy, legal power of attorney (POA), will and trust documents should be in place —your financial advisor needs copies of these important records, along with those who need to know so that your wishes are honored. If you make changes to any of these, be sure they are duly witnessed, signed, copied and distributed. Too often we’ve seen a sudden health care emergency cause unnecessary stress due to missing, improperly executed or partially changed instructions. Having these plans in place not only helps clarify and document your wishes but also can help your family get through a difficult time with less stress.

2) Avoid Decisions under Duress

Research can now consistently show that decision quality declines during periods of grief or fear, no matter what our age. With scams and fraud attempts becoming more complicated and harder to detect, it’s prudent to be intentional with decision making and not letting emotions dictate our actions.

We have seen clients who were told they were expected to die within six months, who gave away all their money and then lived another ten years (in less than ideal financial circumstances). Sudden health events, loss of a spouse, or a major transition can create emotional stress and quickly overload our brains, making clear-headed thinking difficult. Consider delaying large gifts, making major purchases, or sudden portfolio changes during health scares or family emergencies until things are calmer and you can consult with advisors.

3) Manage Medicare Carefully

 By the time you are in your 70s, you are likely to be already enrolled in Medicare Part A, Part B, and Part D. But it’s still important to review coverage annually, Medicare decisions don’t end at 65. Don’t overlook changes to prescription drug plans, and review your Medicare Supplement or Advantage insurance plan to see if it is still the most appropriate for your situation. If you (or your spouse) are still working at age 65, you may qualify for a Special Enrollment Period (SEP) to delay Medicare Part B and Part D enrollment without penalty, provided you have group health plan coverage based on that current, active employment.

Required Minimum Distribution (RMD) rules can also impact Medicare premiums. It can help to talk with your trusted financial advisor about any questions, options, and which strategies might be optimal for your retirement plan.

If possible, you want to avoid the income-related monthly adjustment amount (IRMAA) sliding scale, which is a set of statutory percentage-based tables to adjust Medicare Part B and prescription drug monthly premiums. If your income significantly varies year-to-year or you experience a life-changing event, seek counsel about how to handle a sudden significant income increase or decrease.

Medicare bases its monthly premiums on your prior year’s modified adjusted gross income (MAGI). The current Medicare premium tiers, premiums and deductibles can be found at cms.gov.

4) Watch Financial Gifting Guidelines

As part of your legacy planning, your CPA and/or financial advisor may suggest you consider maximizing tax-reducing gift strategies. Inter-generational gifting strategies for heirs might include paying rent for children or grandchildren, paying for childcare costs, purchasing a new car for a loved one, paying off a relative's student loans, or contributing to a grandchild's college savings fund. But the guidelines for tax-free gifting can be confusing. Conceptually, the annual exclusion gift is rather straightforward: Anyone can give anyone — relatives, friends, and even strangers — annual gifts of up to $19,000 (2026) without the donor having to pay taxes. But in reality, it often gets more complicated, and more wrinkles get added when gifting to married couples. Consulting with your CPA or a tax attorney is wise.

Current Federal gifting and estate tax rules are generous but may change in the near future. If gifting is an important part of your legacy planning, it’s important to stay current with the latest rules and regulations so that you can keep your plan up to date.

5) Keep Family Business Agreements in Writing

Do you own a family business? Are your children or grandchildren a part of that business? If so, it is wise to protect yourself and the business by having a buy/sell agreement as it may save many headaches later, especially if you're counting on money from the business during retirement.

An unfortunate example from a past client involved a grandchild who was running the family business and the grandparents were still living off some of the profits of that business in their retirement. The grandchild suffered from substance abuse addiction and ran the family business into the ground. The grandparents had no legal ability to step in and they never received a return on their business investment.

No one wants to end up in that position. If you’re a business owner, a succession plan and clear documentation for any buy-sell agreements, operating agreements, and expectations after you retire can go a long way. Informal family agreements can unravel quickly when things like major illness, addiction, divorce, or death occur.

6) Transition from work at your own pace

We know that more people are working into their 70s – either by necessity or by choice. In fact, national research from the Center for Retirement Studies shows that 37% of all workers expect to work past age 70 – long after the typical retirement age of 65. Retirement planning, like financial planning, is unique to your personal journey. Don’t be pressured to do things the “normal” way.

Continuing to work into your 70s can be a financial or emotional bridge to retirement, part-time work can help to ease into retirement both financially and socially. Working longer provides additional years to bring in income and grow your savings — or develop new interests and friends in a new community.

7) RMDs/QCDs

In your 70’s you’ll reach the age where the IRS mandates that you start taxable distributions from retirement accounts. Required Minimum Distributions (RMDs) originally began at age 70 ½, but has since been pushed back to 72, then 73, and eventually 75 for those born in 1960 or later. These distributions begin at approximately 4% of your retirement account value and incrementally increase each year; the year-end value of your retirement account is needed to calculate this annual RMD amount. You can choose to take this amount anytime during the calendar year: it can be done all at once or throughout the year periodically.

For those that are charitably inclined, you may wish to gift some or all of your RMD amounts to qualified charitable organizations; these are called Qualified Charitable Distributions (QCDs). QCDs allow the retirement account owner that is 70 ½ years old or older to donate to one or more charities as tax-free IRA distributions. This may be more beneficial than a tax deduction, especially if you do not itemize or wish to reduce your taxable income (AGI) to help eliminate phase-out and income limitations.

Meeting or talking regularly with your financial advisor, tax attorney or CPA will help you stay on top of changes in state and federal tax laws that can affect you.

Whether you’re still working, fully retired, or somewhere in between, these seven tips will help you shape a plan that balances income, health care costs, and your own priorities in your 70s. By being proactive, you create more flexibility so you can focus on what matters most.

Resources

Medicare Basics - Medicare.gov

Updates and Announcements for Medicare and Medicaid - CMS.gov

Frequently Asked Questions on Gift Taxes - IRS.gov

Retirement plan and IRA required minimum distributions FAQs - IRS.gov

Paying for Long-Term Care - NIA.NIH.gov

Consumer Alerts on Fraud and Scams - FTC.gov

This material is for general information and educational purposes only and is not intended to provide specific advice or recommendations for any individual.

Adam Robert, CFP® is a co-owner of Clute Wealth Management in South Burlington, VT and Plattsburgh, NY, an independent firm that provides strategic financial and investment planning for individuals and small businesses in the Champlain Valley region of New York and Vermont. For informational purposes only. LPL Financial does not offer legal or tax advice. 

Securities and advisory services offered through LPL Financial, a registered investment advisor, member FINRA /SIPC. Clute Wealth Management and LPL Financial are separate entities.