What to Consider When Planning for Retirement
By: Jim Molloy
Okay you can see your retirement on the horizon. You’ve been working hard for decades in anticipation of that special day. But wait, doubt starts to creep in… “Have I done enough to ensure I can retire?” We have to make a number of decision between the ages of 55 and 70, and those decisions could mean the difference of running out of money or making it to the end of the game with our financial independence intact. When can I take money out of my retirement accounts without paying a penalty? When do I apply for Medicare and Social Security? What happens when I turn 70 ½ (not 70 that would be too easy)? The decisions you make when answering these questions will have financial implications. It’s important that you understand the consequences of those decisions before you make them. I always like to ask these four questions when I’m talking to someone about their retirement:
- Do you know which buckets you should be putting your money in?
- Do you know how much you should be putting in the buckets?
- Based on the lifestyle you want to live in retirement, do you know when you can actually retire?
- Do you know where your paycheck will be coming from throughout your retirement years?
One of the great benefits of having a comprehensive financial plan in place is that it allows you to answer those questions with a much greater degree of confidence. So, if you have an advisor and it’s been a while since you last met, I would suggest your reach out to them and make sure these questions are being addressed in your plan.
Growing old is mandatory, doing it well is optional. Make sure you have a plan in place!