2017 will be soon over, and 2018 will be here. And as usual, it is up to you how you would like to spend your entire new year. If you plan to retire this 2018, it is not yet too late to pick up your pen and jot down your retirement plans. You might be thinking that you are well prepared for retirement, but think again, your finances, and other aspects of retirement might not agree with you. There’s still time to make improvements and take last-minute steps to sure up your strategies. Here are twelve things to do before your retirement to make sure that you are ever so ready for this new phase of your life.
Self-analysis or actualization
What do you want your retirement would be?
Having a clear vision or goals for your retirement is the best way to jumpstart your planning and make sure that you will be able to achieve what you want in your golden years.
Would you like a slow transition into retirement by having a part-time work or you want to straightforwardly dive into it immediately and indulge yourself in your well-prepared list of fulfilling activities?
By having a structure to your day, goals to meet, mental and social activities will keep boredom at bay. Also, you will be able to shape your retirement according to your preferences.
It is best to discuss your plans and objectives with your loved ones, especially to your spouse or partner. Share with them how you want to spend your time. The discussion is especially important if you are retiring ahead of your partner because his or her time might get affected by this big changes that you are going to make. Take time to sort thigs out how you two can make necessary adjustments to be able to meet each other’s goals. Take into consideration each other’s desire, time, interest, health and financial health.
Make your life easier in retirement by organizing key documents. In case of emergency, your loved ones could easily go through them and access critical information needed in ay situation you’ll be in.
Secure your retirement with benefits and coverage
In retirement, a lot of things will change, and that also includes the benefits and coverage that you have. Retiring from the workforce also means that you are also retiring from the benefits that employers are giving you. After that, you are all by yourself now. Make sure that you are up to date with the benefits that you should be enjoying and the coverage that you should be having in retirement.
Health Insurance, Medicare, and Medigap
Fidelity has calculated that a 65-year-old retiring couple will need $275,000 for healthcare over the span of their retirement. Knowing those numbers and what to expect from healthcare aspect of retirement will give retirees the edge to prepare for the possible health need in retirement.
Ask your human resource person if you’ll have employer-covered health care during retirement. If not, then find out other options, such as health insurance policies, that will cover your healthcare.
But if you are retiring at age 65 or older, you are eligible to be a Medicare beneficiary. Medicare is a health insurance program provided by the government. You can use this to pay for inpatient hospital stays, care in a skilled nursing facility, hospice care, some home health care, certain doctors’ services, outpatient care, medical supplies, and preventive services. But you should also know that it only covers about 80% of your health care bill. You still have to deal with the cost left by your Medicare coverage. For that matter, another coverage that you should look into is Medicare supplement plans. Also known as Medigap plans, it can help you pay for healthcare expenses by covering the gaps in Medicare.
Based on your personal medical history, look into products or coverage that will be able to provide you with your health needs. Consider what you may need now and what you may want after the age of 65 to complement public medical coverage.
Long-term care insurance
Anyone of us might need some forms of long-term care at any point in our lives. Just like healthcare, long-term care can also cause great burden and dry up your hard earned savings. Look into long-term care insurance and find out how it fits your retirement plans.
Having different forms of health coverage will help you put your mind at ease knowing that you have something that you can rely on once the need started to arise.
Map out your finances
Having a continuous stream of income or cash flow to fuel your retirement all throughout is important. That is why carefully planning your finances is a must before you retire.
Look at your retirement income sources
Know where you’ll get the money to fulfill your expenses and needs. You may want to consult with a financial advisor to help you with your personal financial plan and determine a withdrawal strategy and everything that deals with your finances in retirement. If you are planning to take a part-time job, you can also include the income that you expect from this source.
Also look how much you can get from other sources such as pensions, Social Security that can take just a part, not all, of your retirement expenses. It pays to check the numbers how much you have saved in different retirement accounts. Use them carefully to ensure that it will last your entire retirement period.
Boost your retirement savings
As much as possible, max out all your retirement accounts before or even months before you retire. If possible, take advantage of catch-up contributions. Do this because you can never save too much for your retirement.
Create a retirement budget
Believe me or not, but the amount you’ll spend before and after retirement is very different. That is why it is very essential to create a post-retirement budget to avoid overspending in your golden years. Without a budget, it will be easy to indulge in different activities and fell into freedom feeling.
Once you have a retirement budget, test drive it! Try living on your retirement budget and find parts to make improvements.
In retirement, you’ll have more free time that you would expect. Retiring from workforce means you’ll have about eight hours to fill every day. Before retiring, it is important to determine how are you going to spend much free time every day.
Make a plan of your time
Figure out how you will spend the time that you previously spent working. The transition from busy career person to pure leisure can be emotional and overwhelming. Having a plan of activities, hobbies, and events will help you cope and keep boredom and depression at bay.
Coordinate with your partner
Doing things with your partner is fun. As much as you can, involve your partner in retirement planning and activities. But take into consideration the benefits, finances and other investments that will be affected if both of you retire at the same time.
Relocate to retirement
If you plan to relocate, do this while you are still employed. It is easier to support mortgage while still on full salary. Choose a place to retire with cheaper cost of living.
Declutter both your house and mind in preparation for a new chapter in life is in ay way a good idea.
Build an ultimate emergency savings fund
From the moment you decide that you will retire soon, start to build an emergency fund. Ideally, you should raise a saving that could cover up to 12 months worth of living expenses. But to build an ultimate one, save up to 36 months worth. Do this by cutting expenses like cable or other subscriptions that you have.