After many years of working and planning for retirement, I’ve found it’s not that easy to just say “Today’s the day. I’m going to retire.” I’m a planner, so I’ve been working toward this day for years. But, when is the best time financially to retire?
There are so many things to consider, including, What benefits do I take? Do I save some for my spouse in case I’m not around? A lifetime of working and saving, but how long will it last? Do I live only on my pension or do I draw from my personal retirement account? Do I sign up for Social Security early or do I wait? And what about health insurance?
I thought all these years of planning and saving were tough, but I’m realizing that finding the right answer and making these decisions isn’t as easy as I thought.
Here are some steps you can take to help you get ready to retire:
Find a good financial advisor
- Having someone help you work toward your financial goals can be a valuable asset.
Understand how much you will need to save for retirement
- Use this calculator as a starting point, to help you know how much you will need to save for retirement.
- Set up a budget for retirement. Once you retire, your income is less. Eliminate anything you don’t really need.
- Pay down as much debt as possible while you are still working.
- Refinance your mortgage. Housing is a big expense for retirees. Make that payment smaller.
- Finish large projects now so you don’t have to worry about financing that new roof, new garage or new vehicle during your retirement.
- Save now for projects you want to do in retirement and have that money ahead of time so you aren’t dipping into your retirement income.
Go to independent retirement classes
- Questions on pensions, retirement accounts and Social Security benefits will be answered. Most classes are free of charge. Take advantage of them.
Go to Council On The Aging
- The Council on Aging is a good resource to help get everything lined up. They will help with questions on everything from budgets to health insurance.
Become an AARP member
- AARP is a good resource for many things. You can purchase supplemental health plans that Medicare doesn’t cover. You can get discounts on car and home insurance. You can purchase life insurance if you aren’t fully covered. You can also get discounts for certain purchases.
Shop around for insurance
- Do comparison shopping on car insurance and home insurance. Compare premiums every three years or so to get the best deal you can. Get this done and in place ahead of time.
Talk with other retirees
- You aren’t the first to retire. Many have retired before you. How are they doing? What decisions did they make and why? What secret organizations are out there that you don’t know about? They can provide helpful advice about things to take care of before retirement. Compare notes.
Get your estate planning in place
- Many of us haven’t done this—get your will or living trust in place. You want to make sure that all this planning and saving you have done all these years is left to your family if you should die too soon. Make sure any wishes you have will be carried out when you are gone.
- Fill out your Medical Directive. Make sure it’s what you want.
- Consider being an organ donor and fill out your organ donor card, if you haven’t already.
After all the classes, all the questions, all the decisions are made, you’re ready. Now you can breathe easy and enjoy your retirement.