Retirement Planning Tip #1

Thinking about what you’ll do in retirement is fun . . . and planning for it doesn’t have to be difficult.

Financial planning is not just about assets, investments and net worth.

It’s about how you feel and what you want.

It’s about identifying your expectations, concerns and goals. It’s about making sure you achieve your goals—your needs, wants and wishes.

If you’re one of the 7 out of 10 Americans who don’t have a financial plan, and you want to have fun in retirement, it’s probably time to get started.

Retirement Planning | Having fun on the beach

Here’s how.

#1 Leaving a legacy

As you get older, it’s common to begin thinking about what you’ll leave behind and how you’ll be remembered.

You may want to leave a financial legacy to your adult children to help them pay down their mortgage. Another priority could be funding your grandchildren’s college education. Or you may care passionately about a charity or another cause.

What you can do now:

Start thinking about your financial legacy and what will be most meaningful for you and your family.

#2 Retirement expectations

When you think about retirement, what do you most look forward to?

In my financial advisory practice, the most common choices my clients identify are:

  • An active lifestyle
  • An opportunity to help others
  • Moving to a new place
  • Working part-time
  • Traveling
  • Spending more time with friends and family
  • Feeling less stress

What you can do now:

Begin thinking about the lifestyle you want in retirement. What activities and hobbies will you enjoy? Are there new interests you want to pursue? Will you want (or need) to work part-time?

#3 Retirement concerns

It’s only natural for you to have retirement concerns. After working for most of your adult life, it will likely be a very different lifestyle.

The top concerns I hear from my clients about retirement include:

  • Running out of money
  • The cost of health care or long-term care
  • Suffering investment losses
  • Current or future health issues
  • No longer having a paycheck

What you can do now:

Make a list of the concerns you have about retirement and assign a level of concern to each one: high, medium or low.

#4 When to retire

When are you planning to retire? According to a study conducted by SmartAsset, the national average retirement age is 63. Amongst individual states, the age ranges from 62 to 65.

When do you plan to retire?

The answer to this question is highly personal. Typically, there are some common ‘triggers’ for retiring:

  • Your employer may offer you an incentive to retire early.
  • You may have saved aggressively and now have enough money to retire.
  • Some people work until they have earned enough social security or other pension credits.
  • Others retire because they want a lifestyle change—they’re either dissatisfied with their work or simply tired of the daily grind.
  • Finally, retirement arrives for some people because of a plan.

#5 Life expectancy

Your life expectancy depends on a number of factors including your gender, health, family history, the number of times you work out each week, and more.

While no one has an accurate crystal ball, professors at the University of Pennsylvania developed this calculator to give you a ballpark on how long you’re likely to live.

What you can do now:

Check out the life expectancy calculator to get an idea of how long you might live.

Retirement planning doesn’t have to be complicated.

While you may feel overwhelmed at the idea of creating a retirement plan, it really doesn’t have to be complicated. Think about the importance of a financial legacy, the type of retirement lifestyle you want, the retirement concerns you have, when you want to retire, and your life expectancy.

That’s all there is to it.

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