What’s a good way to retire? What’s the best way to retire? Just work until your full retirement age, call social security and start getting checks in the mail? Sounds ok…but is there a better way?
We’re thinking a checklist might help. But not an exhausting list that covers what time to go in for your health checkups. What about an overview list that will get you thinking about the most important things? A list that will set you up with a plan well before it’s time to sit back, relax, and yes, wait for those social security checks to come in.
Who will you retire with is probably the most important part of this list, but it’s second in terms of order. Are you married? Are you a widow? Divorced? All of these variables will play a role in your benefit check from social security as well as your overall tax situation and level of happiness. The goal is to maximize enjoyment of these years so choose your WHO wisely.
Your full retirement age is set by social security but you don’t have to wait until then. You can retire and start receiving benefit checks as early as 62, but the longer you wait, the higher your monthly check will be. Questions you will want to answer are, do you need the income now? What is the longevity of your family history (how long will you likely live)? Do you plan to keep working part time when you retire? Get a timeline down on paper before you move on to the first step. Yes, this was step 2, but think about it first:)
What are you going to do when you retire? You can’t just sit on the couch and watch TV (well, you actually can, but you’ll die way quicker). You’ll need a hobby, a cause, a part-time job or a combination of multiple things to commit your time to. Reinvent your life…again.
Planning your how will be putting your plan into action. This is a simple exercise of making sure your income exceeds your expenses, without the monthly income from job. Will ends meet? Make a list of all the monthly bills you have, including healthcare expenses. Figure on the high end to give you some room to be wrong. Now it’s just a matter of subtracting your grand total of expenses from your income. Do you have a positive number? Let’s hope so or you’ll need to keep working and let that social security check simmer.
Where does this ideal retirement stage of life take place? At your kids’ house? Thailand? Costa Rica? In a motorhome? Use your imaginative skills to visualize where you want to retire. The HOW will need to connect to the where. Retiring on a beach in Maui will require a large retirement savings so plan accordingly.
Maybe the WHY should be number 1. Why are you retiring? Would you rather work? Do you have a great job, a business or a situation that doesn’t require an all-stop and reconfiguring of your life? If this is true, then there’s no need to retire. Retiring is simply the ending of one stage of life and the beginning of a new stage. If you’re not ready for that, let it roll but spend some time thinking about why you are potentially making this life transition.
If you’re 65, 11 months, 3 weeks and 6 days old and your full retirement age is 66, get to work on this list now…as in right this second.
If you’re 41, have kids in school, a steady job, a 401k plan and health insurance – you can wait until the weekend. It’s never too early to start thinking about retirement.
(Newsletter provided by Brockman Capital Management)