There are times in our lives that are decidedly awkward. Being a tweenager certainly tops my list. I’ve never met anyone who looks back fondly on their middle school years—a time that’s fraught with change and uncertainty. I’m glad that’s in the past.
Fast forward a lot of years to another awkward life stage: That time when retirement is on the horizon but not quite real yet. That’s where I am. It used to be that when people asked what I do, I’d tell them about my work. Now it’s more complicated. I’ve got work, but I’m also rehearsing retirement: I swim in the middle of the day, volunteer, and take vacations that last more than a week. I even have weekends that last more than a weekend. It’s much more fun than middle school.
Pre-retirement is also a time to do some deliberate thinking about the future. Financial planning is key, of course, but before you get started with that, you’ll want to decide what your retirement is going to look like. There are no rules for a satisfying retirement. It’s up to you how you want to balance paid or volunteer work, learning, hobbies, travel, family, and other adventures. The idea is to envision your preferred lifestyle before actual retirement hits, then your financial plan can help make it real.
Retire with a positive plan
I recently had a visit from a Midwest cousin who I hadn’t seen in ages. He told me he’s going to retire in two years from his engineering job. I asked what he plans to do after that. He said he didn’t know. I imagine he’ll figure something out, but he seemed to be a little uneasy about a near future that’s undefined.
With a financial plan based on your own personal vision for retirement, you can be more confident that your priorities are realistic. Here are some things your financial planner will consider:
- Understanding what your spending needs will be and whether additional income may be needed.
- Targeting the best time to start receiving Social Security based on your situation and needs.
- How to reduce or eliminate debt if you’re approaching retirement with loan, credit card, or mortgage payments.
- Consolidating and managing retirement and pension plans you may have accumulated over your career.
- Integrating private health insurance coverage into your budget if you’re retiring before your 65th birthday, and planning for Medicare once you reach 65.
- Including tax strategies into your investment strategy by mapping out Roth conversions, capital gains, and the timing of withdrawals and required minimum distributions (RMDs).
- Anticipating potential surprises and alternate scenarios so they don’t derail your plans.
Pre-retirement may be an awkward time, but it’s also a chance to envision what you’re going to do with the rest of your life. It’s a time when you get to explore more of what you love, or try something completely new. The more you prepare, the more you can look forward to enjoyable years ahead.
Some people wait until retirement is imminent to create a financial plan. If your retirement is still a few years off, now may be the perfect time to talk to an Arrivity financial planner.
More pre-retirement tips:
- Develop a budget for retirement and update your retirement and estate plans.
- Be sure any documents or personal information (i.e. pension or retirement plan) that are saved on your work computer are moved to an accessible location before heading out the door.
- Prioritize and plan your bucket list. Also, imagine what your week will look like so you know how you will stay engaged mentally and socially.
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Please contact us at 206.217.2583 or info@arrivity.com if we can assist you or someone you know with financial planning.
Liz is a Late Boomer in the sandwich generation who started an independent writing and brand consulting practice after years as a senior marketing executive. She lives in Seattle, Washington. Her mother lives nearby and her daughter is a recent college graduate.
The foregoing content reflects the opinions or perspective of Liz Behlke and/or Arrivity financial planners and is subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that the statements, opinions or forecasts provided herein will prove to be correct. Past performance may not be indicative of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns Securities investing involves risk, including the potential for loss of principal. There is no assurance that any investment plan or strategy will be successful. Arrivity does not give tax or legal advice. Tax and/or legal strategies should be discussed with a professional before implementing.