Retirement is often one of those things that people start to think about and dream about many years before it actually happens. The idea of being able to retire from work, enjoy your life without worries and stress, and just really take things at your own pace is extremely appealing and exciting. Of course, with that said, retirement isn’t just something that you can rush into and decide upon at the last moment. In fact, retirement is something that can take years, if not decades to prepare for, to ensure that you are able to enjoy it to the fullest extent.
If retirement has been on your mind more and more lately, and you are getting closer to retirement age, then there are some things worth considering. Here’s a look at some tips you’ll want to keep in mind.
1. What Will be Your Retirement Income?
When you retire, you will no longer be working a job, obviously, which means no more stable paycheck. While it would be great to think that was the end of the story and no income is necessary, that just isn’t reality. You will still need an income to pay the bills, even if your bills are small. That income could be the retirement savings and investments you’ve worked on, it could be that you are planning to sell your home and downsize using the profits as your “income”, then there is Social Security income, and so forth.
Figuring out your retirement income can be quite a stressful undertaking and rather confusing. It can be really helpful to speak to a financial advisor well in advance who can help you plan for retirement, figure out how much money you’ll need to live on, and then find a way to make sure you have that money.
2. Downsize Wherever Possible
Downsizing can also be a great tip for seniors, as there is no need to be carrying extra expenses and responsibilities on your plate once you retire. If you still live in a large home, ask yourself if this is truly necessary. It may be smarter to downsize, even to a condo where you no longer have to deal with outside maintenance.
If you and your spouse both plan to retire at the same time, you can also think about getting rid of one vehicle if you currently have two. There may not be a reason to have two anymore. Again, this is cutting down on expenses that just aren’t necessary.
3. Set Up a Retirement Budget
Another financial consideration is to set up a budget that you will stick to once retired. Even if you have never had to draw up a budget before or live on one, retirement tends to carry with it a very fixed income, so you need to be ultra-aware of your spending habits.
4. Consider Your Life Insurance Needs
As a senior, your life insurance needs will be very different from those of a 20-year-old. One popular option, as discussed in this blog, is term life insurance. When you purchase term life insurance, you will need to think about who it is meant to protect, what your current health is, and what your budget is since you will be paying a premium. When you are in your 60s, typically, you can choose from a 10, 15, or 20-year term. Keep in mind the 20-year term is rather difficult to find as the 10 and 15-year terms are the more common option.
If you’re not interested in term life insurance then there is also permanent life insurance specifically for seniors.
5. Make Sure You Use Up All Your Time Off before Retiring
Once you start drawing closing to the actual retirement date, this is also your chance to use up any time off that you may have banked or is owed to you. If you have a lot of time off banked, then you could essentially start your retirement early and still get full pay for the start of it.
If you do plan on piggybacking your time off right into your retirement, be sure to discuss this with your employer well before that point. Retirement isn’t usually something that just sneaks up on you overnight; rather, it takes lots of planning.
6. What Do You Plan to Do to Stay Busy?
For some people, when they think about retiring, their focus is just on not having to work anymore and having that freedom from the daily grind, but they don’t give much thought to anything else. Sitting at home lazing around for the first few weeks may seem great, but there’s a good chance you’re going to get bored of that in no time. This is why it’s a good idea to think about how you will plan to stay busy and active, both mentally and physically.
Retirement can be an opportunity to travel, take classes, and learn a new skill or hobby. It could also be a chance to spend more time with family or socialize with friends. If you haven’t given much thought as to what you will do with your time, it can be wise to join a local senior center or club, as this is a great way to hear about various activities, events, and classes, plus you’ll be meet other retirees just like yourself.
When searching for things to do, be sure to ask about senior discount rates. You may be surprised to find just how many places offer a discount.
Remember, you have worked really hard and really long to get to this point, so now is the chance to take full advantage of it and make retirement as wonderful and amazing as possible.
Retirement is What You Make It
At the end of the day, your retirement will be as amazing and rewarding as you make it. Pre-planning will help ensure that it is smooth, and you can afford to retire when you want to. Having an actual plan for how you will spend your retirement years is just as important.
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