Have you ever wondered why at retirement parties the person retiring was given a gold watch? From what I have found, this practice originated with PepsiCo in the 1940s. They would say, “You gave us your time, now we are giving you ours.” Time is our most valuable commodity and making the most of it in retirement requires planning ahead. Here are some things you should take the time to do now so you don’t worry about them once you retire:
1. It’s not just what you’ve saved, it’s what you spend! Figuring out your budget is critical. Start with looking at what your core expenses are. Things like food, clothing, shelter, healthcare and transportation must be accounted for. Then try to look at variable costs such as travel, hobbies and spoiling the grandkids.
2. Define your goals and plans for retirement. “How did I find time to do everything while I was working?” is what I love hearing from my clients. I think there is a relationship between keeping busy and being happy in retirement. Figure out what you want to do with your time. What do you want to accomplish? Where do you want to go? Who do you want to be with? Stay physically, mentally and socially active. Don’t let boredom creep in.
3. Where is your income coming from? Make sure you are aware of the details of any pensions and social security benefits you expect to receive. Are your income sources reliable and consistent, or are they variable and subject to change or even go away? You retire with an income, but you stay retired by that income rising over time. Don’t forget that inflation can be your worst enemy in retirement! Working with a planner to help make decisions in this area can be time well spent. Pensions usually have several payout options, and sometimes even a buyout option. Filing for Social Security at the wrong time or not considering a spouse could cost you in the long run. Put together an income plan with a financial planner.
4. Make sure your legal documents are in order. Things like trusts and a will help make sure your savings pass to who you want and hopefully minimize or eliminate the impact of probate. You also want to make sure things like your living will and powers of attorney for financial and healthcare matters are up to date as well. Do an audit of beneficiaries on your retirement accounts, insurance policies or anything that you can.
5. Consider “what if” scenarios. Make sure your planner is helping you look at potential problems in the future. Don’t let a healthcare crisis, loss of income or unforeseen emergency force you into a financial decision.
Planning starts ahead of time to help make the transition to retirement. Work with a team of trusted advisors who will look at more than just your investments. This is your retirement, and you deserve to enjoy it!
Michael Macke is vice president and co-owner of Petros Estate & Retirement Planning, LLC, which is a comprehensive, holistic financial planning company with offices in Jacksonville, Palm Coast, Winter Park and Port Orange. Macke is a Certified Financial Planner (CFP), the most highly regarded designation within the financial planning industry. His focus is on personal financial planning and helping people identify, achieve and protect the lifestyle they want in retirement. For more information on Petros Estate & Retirement Planning, LLC, call (904) 824-5656 or email info@petrosplanning.com.
