Posted in Triplett & Carothers on July 2, 2024

If you have reached the phase in life when you plan on leaving the daily grind, you can organize your agenda by dividing your to-do list into stages: the early days (three to five years ahead), the final years (two years before) and the final stretch (the ultimate six months).

A stitch in time

Start laying the groundwork even while retirement is just a glint in your eye. Talk to your spouse and children about their expectations for you, too. Beginning about five years before you pull the plug, you can take initial steps to make the entire process smoother. These preparatory exercises will help give you a feel for how a successful retirement might eventually shape up.

Begin keeping a file listing all important documents, contacts and numbers. Make an extra copy while you are at it. Gather account and policy numbers for insurance, investment and bank accounts; wills and trusts; your birth certificate; last year’s W-2 forms; and marriage or divorce papers. Be sure to tell your partner or beneficiaries where everything is stored.

Pick a tentative retirement date. It’s a moveable feast that you can use for the first round of budgeting and investing calculations. Begin a test drive by tracking your living expenses for a couple of months. Run at least three retirement calculator iterations to crunch the numbers for budgets, and use different assumptions. Dig up any old and current pensions. Set up an appointment with a retirement planning specialist who can help you determine how to best juggle estimated future income and expenses. Consolidate retirement accounts. Aim to reduce administrative hassle with easier balancing and better diversification by streamlining any overlays and duplications.

Would you prefer to relocate or to carry on where you are and age in place? Take some vacations in areas you might consider moving to and research real estate markets there.

Retire any high-interest credit cards, or possibly a mortgage, to reduce debt. Accelerate Social Security savings to boost benefits. If you are contemplating long-term care insurance, consider your own health, your family health history and your life expectancy. It is cheaper to buy insurance while you are younger. Expect to live longer than your parents, and expect more inflation.

It takes time to forge friendships, so start building social networks outside your work contacts. Meanwhile, keep exchanging ideas with co-workers who are also taking the plunge. Have any of them negotiated a phased retirement with your company?

Your final couple of years

It’s getting closer. Look into post-retirement medical benefits and life insurance. Find out whether you can pay a monthly premium to remain on any group policy, which may expire when employment ends. You are permitted by law to continue for 18 months by paying the full coverage costs.

While you still can, take advantage of all your benefits, including accumulated vacation and personal days. Now it is high time to complete any dental work, remembering that traditional Medicare will not cover that.

The same principles apply to your home! Get a thorough inspection and fix any lurking problems, such as a faulty roof even if it has not yet leaked. Check the water heater and kitchen range. Look out for mold and mildew. Have you decided what to do with all your household contents or furniture if you are moving? If necessary, consider getting a mortgage or a home equity line of credit now while your income level permits it. You may also find it psychologically easier to undertake major home remodeling or other significant purchases, such as a new car, while paychecks are still flowing in.

Have you considered building bonds or certificate of deposit ladders, which would be scheduled to mature in coming years?

The last lap

When it’s about six more months away, retirement day is around the corner.

Copy permitted information from your work systems to your home computer. Contact Social Security three months before your first benefit payment is due. Meet your retirement specialist again to review your choices and make final adjustments.

Reach out to Roz Carothers and her team at Triplett & Carothers to learn more.

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