Retirement Planning Guide: 7 Things to Finalize Before the Big Day

According to research, one of the most significant concerns for about 70% of Americans involves not having enough money to last through retirement. This is a serious and valid concern because, at that point, they would not be able to get back into employment.

Now, the fact that you worked long and hard for your retirement is an achievement. You beat the odds, stuck to your savings plan, and now you’re ready to enjoy the retirement you very well deserve. Still, there are several more things you may want to do before the final day.

In this retirement planning guide, we’ll discuss several important things you should finalize before retiring. This includes making sure your finances are in order, updating your estate plan, transferring your assets, closing out any outstanding loans, and more.

Table of Contents

1. Make Sure Your Finances are in Order

Putting your finances in order includes finalizing your retirement budget, consolidating your accounts, and planning for healthcare costs. When you’re retired, your income will likely be different than when you were working. It’s important to sit down and figure out a budget that works for you.

Make sure to account for any fixed costs, like housing and utilities, as well as variable costs, like groceries and entertainment. Once you understand your monthly expenses, you can start thinking about how much money you’ll need to withdraw from your retirement savings each month.

If you have multiple retirement accounts, it might make sense to consolidate them into one account to save on fees.

2. Update Your Estate Plan

If you haven’t done so already, now is the time to update your estate plan. This includes your will, power of attorney, life insurance, and healthcare directive.

Your will dictates how your assets will be distributed after you die. If you don’t have one, your state’s laws will determine how your assets are divided. You may not want this, so it’s important to have a valid will in place.

A power of attorney allows someone else to make financial decisions on your behalf if you’re unable to do so yourself. This could be due to illness or incapacity, and without one, your state’s laws will dictate who makes these decisions for you.

If you have life insurance, you also want to include it in your estate plan. It could be thousands of millions of dollars and you need to allocate it as you see fit. Click here for more on life insurance for seniors.

Finally, a healthcare directive spells out your wishes for end-of-life care. This includes things like life support and organ donation. If you have any specifics you would like, now is the time to create a plan for them.

3. Pay Your Debts and Transfer Your Assets

If you have any outstanding loans, now is the time to pay them off. According to research, about 46% of Americans expect to retire in debt. This includes things like mortgages, credit card debt, and car loans.

The last thing you want is to retire with debt hanging over your head, so pay off any credit card or student loans you may still have. You may also want to consider paying off your mortgage before retiring. This will give you one less monthly payment to worry about and free up more cash flow each month.

Once these are paid off, you can start thinking about transferring your assets to your heirs. Transferring assets involves more than just giving someone your house or bank account. You’ll need to consider things like taxes and estate planning, so this is the best time to finalize all these issues.

4. Confirm All Your Financial Resources

Make a list of all your financial resources, including savings accounts, retirement accounts, pensions, and investments. This will give you a good overview of where your money is and how to budget for it.

You should also make sure you have a good understanding of your Social Security benefits. You can create a Social Security account to get an estimate of your retirement benefits. This will give you a better idea of how much money you’ll have each month to live on.

If you have any other sources of income, such as rental property or a part-time job, make them a part of your retirement income planning. It’ll help you get a complete picture of your financial situation and make planning for retirement easier.

5. Plan for Unforeseen Health Issues

No one knows what the future holds, so it’s essential to plan for unforeseen health issues. This includes things like long-term care insurance and prescription drug coverage.

Long-term care insurance will help cover the cost of things like nursing homes or in-home care if you need it. This can be a big help if you have to go into a nursing home or need someone to come to your house to help with cooking, cleaning, and other tasks.

Prescription drug coverage will help you pay for the cost of prescription drugs, which can be quite expensive. Ensure you research different plans and find one that covers the drugs you’re currently taking or may need in the future. Moreover, ensure you understand what Medicare does and does not cover.

6. Gather Copies of All Plan Documents

When you plan for retirement, it’s essential to have all the necessary documents in order. This includes things like your Social Security card.

You’ll also need copies of any financial documents, such as bank statements, investment accounts, and tax returns. Make sure you have all these documents gathered in one place so you can easily find them when you need them.

If you have any other vital documents, such as a will or trust, make sure to include these as well. This will help you be prepared for anything that may come up during retirement.

7. Confirm Final Financial Compensation With HR

If you’re still working, now is the time to confirm your final financial compensation with HR. You should also make sure you have a good understanding of your retirement benefits. This includes things like 401(k)s, pensions, and other investment accounts.

By knowing what you’re entitled to, you can make sure you’re getting the most out of your retirement savings. It’s also vital to confirm your health insurance coverage. If you’re retiring, you may not have the same level of coverage as you do now.

Make sure to understand what your options are and how much it will cost to maintain your current level of coverage. By confirming all these details with HR, you can be sure that you’re getting everything you’re entitled to when you retire.

The Ultimate Retirement Planning Guide

Planning for retirement can seem daunting, but it’s important to start early. By taking the time to plan now, you can ensure a comfortable retirement later. Use this retirement planning guide to get started on your retirement planning and be prepared for anything that comes your way.

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