Five Things You Want Settled Before Retirement

There are many factors to consider before you retire. Retirement is a milepost in anyone’s life so it pays not to treat the decision lightly. Although a complete checklist is beyond the scope of this article, here are five questions and action items that can get you started as you think about your retirement. (you will find more about this topic in Section V of my book, Chapters 37 – 44)

How retirement will look for you?

If you don’t know what you want your retirement life to look like, it is challenging to plan the rest. Even if you don’t know exactly, begin by listing things that you want to do, the day-to-day lifestyle you want to live, whether you want to study a new subject, work on your golf game, travel, fish, work part time, and so on. It is important to think about and plan for what you will do in retirement. Your activities need to engage you, get you excited, and motivate you to “get your toes out of bed in the morning”.  As with any time in your life, you are the master of your future. If you have entertained the idea of retirement then shouldn’t it be something you go for? Once you know what you want, you can figure out how to get there.

Where you will retire?

This decision, along with what you want to do, will effect much of your retirement financial planning. This is especially true if you plan on moving for any reason. If you move, you might need to sell your current place. How is the real estate market? Will it be easy to sell? Is the cost of living different from where you currently live? You have to know what the answers are to be able to answer the next question.

Is retirement financially viable for you?

The answer to this question could make all of the other plans a moot point. Assuming that you have a ballpark figure of how much it will cost to do what you want, where you want to live, do you have now or will you have the financial resources to succeed with room to spare in case of unforeseen events? If you feel completely confident, then congratulations! However, if you are like most people, you will probably need some professional help from a qualified financial planner to make sure you have everything you need and enough to cover contingencies, some you probably haven’t even thought of.

Even if you think you have every base covered, it is in your best interest to verify where you are on the road to a secure retirement. Get an unbiased “second opinion” to help prevent unhappy surprises down the road.

Talk to a financial advisor and devise a plan for rest of your life

Even with the vast amount of financial advice available on the internet, the problem that many face is one of overload. There is so much information online that you can spend years combing through everything and still not get to knowledge that is pertinent to your specific situation. Even if you were able to assemble all the right knowledge, knowing how to properly use that knowledge can be critical.  You might be tempted to do it yourself. Kudos to you if you actually can handle all of the planning on your own.

For everyone else, the best money that you can spend will be on creating a detailed plan for your retirement

Practice living on your estimated retirement income

By now, hopefully you’ve developed a fairly accurate picture of what your budget will look like once you retire. It’s time to see how that plans feels in practice. It is smart to practice to live for several months on the budget that you have proposed. Some issues will become apparent very quickly. Other issues may appear later. Maybe you have adjusting to a more frugal lifestyle. Or perhaps you discover your planned lifestyle will quickly exceed your budget and you need to make adjustments. Better to know now than later.

The biggest benefit of this methodology is that it’s not permanent. You can make changes to the plan once any blind spots are uncovered. Again, if you partner with an experienced advisor, you may learn tips that you wouldn’t have thought of on your own.

Lastly, you might explore the incredible variety of information sources found in online forums. There are groups aligned with more special interests than you can imagine and they are usually cordial in sharing information.

For more information, please contact me here.