At present there is nothing scarier than crashing markets! Hence, the scaring question of the hour is whether you have planned adequately to be able to survive in such tough situation. No matter how much financial planning you try and do, but end up worrying about the financial security after retirement. You can steer clear of any adverse situations just by bearing a few points in your mind. So, what are these points? Find out about these points in the following pointers:

1. Keep an eye on pension plans: Benefits might reduce or change but, an employer cannot take them away. Economic instability is resulting in losses for traditional pension plans and therefore demanding extra contribution by the companies. Hence, the plan netbenefits of new or existing employees are being suspended by the companies. Thus, it is vital to know when changes are being made in pension plans by your employer.

2. Don’t switch jobs frequently: If you have traditional pension plan, it is advisable not to change the job without thinking about the effect on the pension benefit. In most cases these plans have a five-year frame for vesting into benefit. The 401(k) plan has similarity to these plans where you and your employer contribute equally. In some cases, you might be able to reap better benefits, if you stay in your current job for a little longer time.

3. Avail pension benefits from previous employer: Many employees are unaware of the pension benefits and leave a company. Prior to job switch, it is worthwhile to check about your eligible benefits with the employer. If things work in your favor, keep a track to claim the benefits after retirement.

4. Don’t retire early: The frenzied way of life has resulted in most people opting for retirement before the age of 65 years. Retirement benefits lower substantially if you decide to retire early. Also, in case you discontinue your job, then the remuneration which you would have earned, the additional entitled benefits and your retirement amount will be missed.

5. Lose health insurance benefits: The steep increase in the cost of health insurance is resulting in most companies deciding to phase out the health insurance benefits for the retirees or transferring a major amount to them. Till your age turns 65 years, you are still entitled to medicare. Few medical expenses are still covered even after that. Thus, it is vital to consider this prior to your decision to retire earlier than 65 years of age.

6. Change in Social Security benefits: The age of retirement has been increased to 67 years from 65 years. The people born during and after the year 1938 are the ones mostly affected by this change in retirement age. At 62 years of age, reduced benefits can be gained. A reduction of 30% is now applicable instead of 20%, in permanent benefits. Hence, choosing to retire early is unhealthy for financial security.

7. Ditch lump-sum distribution: It is not at all advisable to accept lump-sum distribution. Some traditional pension plans offer lump-sum distributions as an alternative to monthly pension benefits. Settlement in lump-sum manner should be completely rejected. This might seem lucrative, but it is difficult to invest this sum in other monthly pension options.

It is difficult to have a proper financial planning for retirement. So, before you make your most important decision of retirement, it is crucial for you to be aware of all the available alternatives and choices.