Retirees know the good and bad sides of retirement, and they are happy to share their knowledge. While most individuals enjoy life after work, many wish they had done things differently. Their insights can help you create a healthier and more secure retirement.
According to Employee Benefit News, retirees wish they had:
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Saved more for retirement (86%)
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Invested their money earlier (60%)
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Prioritized their health while working (52%)
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Embraced work-life balance sooner (28%)
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Spent more time with family before retirement (18%)
These lessons show the power of addressing your financial, physical and mental health before retiring. In addition, visualizing your retirement can incentivize you to save and identify areas for improvement during your working years.
Combining these practices can better prepare you for retirement expectations, joys and challenges. Use the following checklist to help you on your path toward retirement.
Financial health
Retirees’ regrets about retirement savings align with the concerns of many workers today. Nearly half (48%) of employees say saving enough to retire is their top financial concern. Close to 30% of people have zero dollars saved for retirement, 33% have less than $50,000, and 30% believe they won’t ever be able to retire. These numbers come from the industry news site BenefitsPRO.
The following steps can increase your retirement preparedness.
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Access your employer’s financial education benefits. Boost your financial literacy by learning foundational topics such as budgeting, debt, interest, emergency savings, mortgages, student loans, credit ratings and spending patterns.
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Participate in your employer’s retirement plan or open an individual retirement arrangement (IRA). Know your plan type and understand key differences. For example, a 401(k) plan is not the same as a pension plan, traditional IRA or Roth IRA. Learn about retirement savings and investment strategies. Research topics include risk tolerance, time horizon, diversification, stocks, bonds, mutual funds, balanced funds, money market funds, exchange-traded funds, index funds, and target-date funds and annuities. Ask about retirement planning tools and resources. Check if your employer offers meetings with financial planners.
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Prioritize your retirement goals. In a survey by PLANADVISER magazine, 73% of parents said saving for their child’s higher education is their top priority. This figure outranked saving for retirement (62%) and emergencies (57%). Helping children with educational costs is a bonus if you can afford it. But experts recommend putting your retirement savings first because there are more ways to pay for college and there’s a longer time to pay down debt.
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Determine the optimal time to start taking Social Security benefits. You can start these benefits between the ages of 62 and 70. The longer you wait, the higher the payments. Waiting until age 70 could net you an extra $100,000, notes the retirement planning solutions firm NewRetirement. But it may be worth taking Social Security sooner, depending on your health and financial needs.
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Review Medicare enrollment details and costs. A Medicare broker can help you evaluate plan options at no charge to you.
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In addition to accumulating money for retirement, learn about decumulation strategies to spend down your assets in retirement.
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Start a detailed financial plan. The book “Ready or Not: Your Retirement Planning Guide” recommends creating a cash-flow worksheet to track your assets, liabilities and spending. Track monthly and yearly figures to identify one-time costs and long-term trends.
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Update and adjust your retirement plan as needed each year. Understanding how long your money is expected to last will reduce your stress and increase your enjoyment.
Physical and mental health
Being proactive about your physical and mental health throughout your career can enable you to do and enjoy more in retirement.
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Take advantage of free and preventive health care benefits in your health plan. Examples include vaccinations and screenings for alcohol use, blood pressure, cholesterol, depression and diabetes.
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Get your annual checkup. Catching and managing chronic diseases and other health challenges can prolong your healthy years in retirement.
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Learn your family’s health history. Talk to your doctor about reducing your risks.
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Prioritize exercise, sleep and healthy eating to create lifelong habits.
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Practice stress management techniques such as mindfulness, meditation and breathwork. Identify counselors, therapists and health apps to support your efforts.
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Ask your employer for benefits related to fitness, nutrition and sleep. Examples include gym reimbursements, online classes, educational resources and apps.
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Understand your mental health resources before you need them. Being proactive can help you maintain good habits and be ready in case of burnout or unexpected mental health challenges.
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Create an advance directive and name a medical power of attorney to carry out your health care wishes if you cannot do so on your own.
Visualize your retirement
According to the health insurance agency MedicareFAQ, nearly 25% of retirees say it’s difficult to find purpose and fulfillment in retirement. Picturing your ideal retirement allows you to prepare now. Envision daily routines, bigger dreams and the overall lifestyle you want.
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Focus on personal connections. According to NewRetirement, regrets about personal relationships exceed financial worries. Think about how you’ll maintain your social health through volunteering, educational opportunities, hobbies and business ventures.
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Create a plan for spending time with friends and loved ones in retirement. A sense of inclusion and belonging is vital to retirement health.
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Decide where you want to live. Cost-of-living and tax considerations are important, but “Ready or Not” recommends prioritizing your community support and social health when determining whether to stay or move. Consider options such as downsizing to a smaller house or moving into a retirement community.
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Identify your travel goals before and during retirement. NewRetirement reports that travel is a goal for 90% of retirees. And MedicareFAQ notes that nearly 60% wish they had traveled more before retiring.
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Talk to the important people in your life, especially those affected by your retirement planning. This list may include a spouse, partner, roommate, children, siblings, friends or relatives. Explain your goals and plans for retirement. “Ready or Not” recommends determining your health care and financial proxies in case you become incapacitated.
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Contemplate the different phases of your retirement and tailor your spending goals accordingly. For example, you might spend more early in your retirement on travel and hobbies. These expenses may slow or stop as you age. Health care expenses often increase rapidly for end-of-life care.
Take advantage of your benefits offerings
For more information on retiring without regrets, give us a call! We can provide education and resources to help you prepare for a healthy and secure retirement.
