How to Prepare for Retirement

Transitioning into retirement can be filled with a mix of excitement and anxiety. Just the idea of leaving the workforce and relying on a fixed income can be intimidating, yet doesn’t everyone eagerly await the day we are no longer beholden to a clock, a boss, a job, or career? We all have visions of spending leisurely days pursuing our own unique interests.

In this article, using retirement advice and insights shared by retirees from all walks of life, I hope to demystify the process by offering practical advice on how to prepare for retirement with confidence.

Start your retirement planning today

Retirees unanimously agree that, regardless of your current age or individual financial situation, the time to start planning for retirement is NOW. Most individuals approaching retirement tend to focus initially on financial strategies. Therefore, it is vital to find a trusted financial advisor, preferably one who specializes in retirement planning and Medicare, who can provide personalized advice on everything from retirement accounts, to taxes, estate planning, and hopefully help you navigate through the land of Medicare.

A financial planner can help planning for retirement

Another important benefit provided by a financial planner can help you create a detailed budget using estimated retirement expenditures—i.e., housing, health care, travel, leisure activities, unexpected expenses—as well as help identify potential income sources in retirement, such as diversifying investments, maximizing Social Security benefits, enjoying part-time work, or having rental income. A thorough budget will help you manage finances more effectively – and is a good idea at any age. Ensuring their retirement financial house is in order is just the beginning for most retirees, based on the responses I received. When asked what they wish they had known before retiring, the response was unanimous—retirement requires an adjustment period!
 

Retirement advice on staying active

Progressing from a structured work/home life to a more open schedule can be challenging for folks. While it is important to stay active and engaged, it is also important not to overbook your time. So many retirees find their days are filled with more activity than when they were working! It’s also a time of continuous learning and adaptation, so being flexible and willing to adjust accordingly works well for most retirees.

Retirement and your social network

Which brings us to the emotional aspect of retirement—many of us don’t realize how much our identity and self-worth is tied to our work life. Work also offers us a built-in social network, so it is important once retired to actively seek out social connections. Developing hobbies, engaging in volunteer work, joining retirement communities, or even seeking out part-time employment are just a few ways people stay active and connected. Pursuing long stifled interests, or better yet, finding new ones, helps people find a sense of purpose and meaning in retirement.

People approaching retirement also mention the importance of estate planning. Having your estate documents—beneficiaries, power of attorney, healthcare proxy—completely current ensures your wishes are followed, eases the burden on your loved ones, while providing you with more peace of mind.

Retirement and health care

Retirees also caution us not to underestimate the cost of health care.  This includes the cost of insurance premiums, as well as out-of-pocket expenses, even the potential for long-term care. While we all hope to retire in good health, nothing good lasts forever, so it is important to be realistic.

Finally, many retirees opt to downsize and simplify their lives, offering them a real bonus that can reduce emotional and physical stress, financial burdens, and often make retirement more enjoyable. Some choose to relocate to a warmer climate. Others decide home ownership is for the young, opting to lean on a landlord to take care of things that break down. The key is that with proper planning, there are real options for you to explore.

A retirement strategy can help you enjoy the journey

I hope that by sharing these insights, future retirees can feel better prepared for the many opportunities awaiting them in retirement, recognize they can make decisions tailored to their interests, enjoy their journey, and approach this new phase of life with less anxiety and a lot more excitement.