Change Your Life With This 5 Step Pre-Retirement Checklist

Change Your Life With This 5 Step Pre-Retirement Checklist

⚒️Resources⚒️

Download the FREE Retirement Checklist here: https://www.thepeakfp.com/retirement-checklist

Free Masterclass On How to Increase Income In Retirement By Up To 30%: https://app.thepeakfp.com/free-training

If you prefer to read the full blog post you can find it here:
https://www.thepeakfp.com/blog/pre-retirement-checklist

00:54 Retirement Checklist Item 1: Understand the primary retirement goals: Outlive your money, Maintain a predictable standard of living in retirement

02:28 Retirement Checklist Item 2: Understand your spending habits

03:59 Retirement Checklist Item 3: Estimate your guaranteed sources of income

05:22 Retirement Checklist Item 4: Evaluate how your wealth is allocated

06:52 Retirement Checklist Item 5: Other Considerations including health benefits, Medicare, spousal retirement benefits, consolidating accounts

Here are 4 parts of our Pre-Retirement checklist that will help you get organized and plan ahead. The earlier you get started, the longer your efforts will have to compound and ensure that you don’t become one of the statistics in an EBRI study…

Understand General “Retirement Goals”

Retirement Goal #1: Do Not Run Out of Money!
Short of a health catastrophe, one of the worst situations that could occur during retirement is outliving your money.

Not surprisingly, this is the most common concern I hear from prospects and clients alike.

Retirement Goal #2: Maintain a Predictable Standard of Living in Retirement
A close second to peoples fear of running out of money in retirement is needing to sharply reduce your income in retirement due to savings or funding shortfalls.

A sudden increase in cost of living or a sudden decrease in the value of your investment portfolio can have dramatic ripple effects on your ability to maintain a predictable income in retirement.

A pre retirement checklist like this article (as well as this downloadable PDF) will help you thoroughly address the things that ARE in your control as you plan for your future retirement.

2. Understand Your Spending Habits
Avoiding running out of money AND maintaining a predictable standard of living in retirement hinge on one thing.

Balancing your retirement income with your retirement spending

Pay attention to:

How much you spend now.

Differentiate between essential and non-essential spending

Set up a system to track your spending.

Estimate your retirement expenses at something between 75%-85% of your working income

3. Estimate Guaranteed Sources of Income
Guaranteed sources of income will provide the foundation of your income in retirement.
These are things like Social Security, Pensions, or Annuities.

They are “guaranteed” in that the income you will receive from these sources will be predictable and reliable once you begin to draw from them.

Estimating your guaranteed income sources can be a puzzle. In most cases I recommend seeking out a qualified fee-only fiduciary financial advisor to assist in interpreting pension, annuity, or social security documents. An error in understanding these documents could lead to faulty assumptions that derail your retirement planning efforts.

4. Evaluate How Your Wealth is Allocated
Start this process by calculating your net worth:
How much equity do you have in your home?

How much are your retirement accounts worth?

How much are non-retirement accounts worth?

Do you have other investments or cash?

How much do you owe on things like your house, cars, credit cards, or other consumer debts?

Next you’ll want to learn how to estimate and track the potential returns on your investments.

Finally, you’ll want to learn how to estimate the INCOME that your investments would be able to produce once you actually need to take DISTRIBUTIONS from those investments.

5. Other Items to Consider
Potentially consolidating accounts for ease of tracking and distribution.

Factor in other retirement money such as spouses IRA’s or 401(k)s, social security, etc.

Understand your healthcare options for when you do terminate employment.

Understand medicare timing and costs.