Seven Critical Things to Do Before Retiring

, ,

If you’re thinking of retiring, and wondering if you’re ready, there are some critical planning issues that need to be examined. Below is just a partial checklist of some items that you should consider. How many of these important issues have you already addressed?

Is your nest egg going to last long enough? Keep in mind that according to the Society of Actuaries, for a couple reaching age 65 there’s a 50% chance that one of them will reach age 92, and a 25% chance that one of them will reach age 97. That means that most people should plan to have their nest egg last 30 years or more. Have you taken that into account in your personal planning?

What are you going to do about Social Security? Social Security is really a type of annuity that is inflation adjusted and offers unmatched spousal benefits. Should you file on your own record, or go for spousal benefits first and allow your own benefit to keep growing, or delay taking benefits altogether? Remember that your own benefit grows by about 8% for each year that you delay starting your benefit. There are a lot of options and you need to make the best decision for your own circumstances.

What are you going to do about health care? If you don’t yet qualify for Medicare, where are you going to get health care and how will you pay for it? And even if you are eligible for Medicare, what kind of supplement policy should you get, taking into account any prescription drugs you may need?

Do you have your Durable Power of Attorney (DPOA) and Health Care Power of Attorney (HCPOA)? The DPOA delegates the power to make legal and financial decisions, and the HCPOA delegates the power to make health care decisions. These are critically important documents that are essential to your family’s asset protection planning. Having them in place can prevent family strife and save substantial time and money when we need someone to step in and make decisions.

Should you get a Revocable Trust? If you are OK with giving your assets to your heirs in full after you’re gone, 100% with no strings attached, then you may not need a revocable trust. But if you want to have any control over what happens to that money after you’re gone, a trust may be a good way to do it.

Do you have too many other major financial commitments? This could include having kids in college (or sponging off you while living in the basement!!), being a co-signer on someone else’s house or car loan, or still having your own credit card debt, mortgage, or car loans to pay off.

Do you have a plan for what you’re going to do in retirement? If you don’t have any hobbies such as playing golf or bridge, you could flounder in retirement. Many people are so defined by their career that moving into retirement can be a shock as they realize they don’t know how to relax and enjoy themselves. It’s important to have a meaningful answer to what you’re going to do with your new found time, or you may find yourself wishing to be back in those boring staff meetings, drinking bad coffee and gossiping over the water cooler!!

This is just a partial checklist to consider. So, after looking over this list, how ready do you feel for retirement?


 More Articles >>>