The Getting ready to Retire Checklist

April 24, 2019

I can always tell when spring has come to Kosciusko county.  Those are the days here at the office when we run the heat in the morning and the air conditioning in the afternoon.  It is also the time that many people start to think about retirement.  I don’t really know why, but I suspect the reason has something to do with how great summers are around here.  However, retiring successfully usually involves more planning than waking up one day and thinking, “I’d really like to have the summer off!”

When you are about 10 years from retirement, one of the first things you should think about is where you and how you want to live.  Will you stay here in Kosciusko county? Will you want to downsize to a smaller home, or one with no stairs?  Ten years out is also a good time to think about what you are going to do.  Do you have a hobby? Do you want to pursue some passion?  Some people don’t think about this until the day they retire, but as one new retiree told me, you can only watch so many episodes of “Law and Order.”  Most importantly, this is a time to start to get you financial life in order.  You may boost your retirement savings by taking advantage of catch-up contributions.  This is also a great time to come up with a plan to pay off your debts, including your mortgage.

As time passes and you are about five years from retirement, you can continue your planning by creating a tentative budget.  Think about what income sources to expect, such as Social Security, pensions, retirement accounts and other investments.  From there, you can create a tentative budget.  If the anticipated expenses are more than the anticipated income, you can take corrective action by saving more, paying off more debt, or delaying your planned retirement.  This is also a good time to consider your potential health care expenses, especially if you are retiring before you are eligible for Medicare.  For many retirees, health care is the number one cost in retirement.  At the same time, you will want to assess the risk level in your investment and retirement accounts.  As you near retirement, you may want to pare back more volatile holdings such as stocks, especially concentrated positions.

At about two years out, you should review your budget.  Are your expense estimates realistic given your current spending levels?  Do you have sufficient sources of income?  Carefully review your Social Security statement.  The Social Security Administration no longer sends annual statements, but you can print your own by accessing it on the website.  If there are any discrepancies in your historical income you should address those with the Social Security Administration immediately.  If you are planning to move to a different city or state for retirement, this is a good time to take an extended vacation to potential destinations, if you haven’t already.  If you are planning to move somewhere permanently, you should visit in different seasons.  Arizona is a whole lot different in July than it is in January!

When you are one year away, put the finishing touches on your plan.  At this point, you should have a good idea of what your expenses and income will be.  If there is an issue, you may still have time to correct it.  This is also a great time to get a second opinion on your retirement plan.  If you have been doing the work yourself, it might be a good idea to have a planner look at it.  If you have been working with a planner, this is a good time to run it past a different advisor.  In either case, you may find something important that had been overlooked. 

Finally, when you are about three months away from your intended retirement date, notify your employer.  There may be some paperwork that needs to be done well ahead of your last day of work so that you can collect your benefits.  You will need to apply for Social Security three months before you want to receive your first payment.  Also, you should sign up for Medicare three months ahead of your 65th birthday whether you are retiring or not.  This is also a good time to make decisions about how you will manage your investments in retirement.  If you are planning to move, start getting your house ready to sell.

You have worked hard all your life to get to this date.  Don’t let a lack of timely planning jeopardize a successful retirement.

For more information, you can listen to the podcast of Smart Money Management radio show on this topic, along with others, at

 The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. 

Securities and Advisory services offered through LPL Financial, a registered investment advisor.  Member FINRA/SIPC.