Entering retirement? Sufficient planning will help you make the most of your golden years. Here are some questions to ask when setting goals for your golden years.
- What age do I want to retire?
The full retirement age is 67 in the United States – you may start receiving social security benefits in full during this time. However, there are individuals who retire at 62 to 65, even if it means they won’t receive the full benefits.
Others retire as early as 40 or 50 if they’ve come into a large sum of money, such as after they’ve sold a company or made lucrative investments.
At the other end of the spectrum, there are people who wait until they’re 70 to retire – they might find their work too fulfilling to resign, or they find that they have not saved enough and therefore need to keep working.
Deciding which age to retire depends on a combination of personal, professional, and financial reasons. Aside from a readiness and willingness to retire, you must also determine if you’ll be able to live comfortably after you stop working.
- How much do I need to save for retirement?
This depends largely on the kind of lifestyle you want for yourself during retirement. A financial advisor can help you come up with the numbers. If you’ve worked for at least 10 years, you’re eligible for Social Security benefits.
But that will most likely not be enough – you’ll still need your personal savings, a 401(k) plan, and investments. Work with your advisor so that you can come up with a long-term financial plan that suits you.
- What kind of lifestyle do I want?
Nearly everyone who enters retirement ends up downsizing. You might find yourself de-cluttering and moving to a smaller, easier-to-maintain home. You might also find yourself downsizing your social circles – moving to a retirement community could also mean saying goodbye to friends, colleagues, and neighbors you’ve known for years.
But that doesn’t mean that your quality of life has to suffer. Many retirees stay physically and socially active well into old age. There are many active adult communities that allow you to live independently, and create opportunities for you to meet new people.
Just keep in mind that you’ll need about 60% to 90% of your pre-retirement income in order to maintain your present lifestyle, and that your annual expenses post-retirement might fluctuate.
- What kind of hobbies will I pursue?
Retirees find that they’re able to indulge any hobbies that they couldn’t pursue previously because of work, time constraints, and financial obligations. Retirement is the best time to cultivate any interests you weren’t able to devote yourself to in the past.
Whether it’s playing golf, painting, collecting memorabilia, or boating, you’ll find a community that supports your interests.
- Do I want to travel?
Most retirees dream of traveling. Ask yourself if you want to join a cruise, travel to exotic locations, or simply go on more frequent hiking trips nearby. You’ll have to factor this into your financial plan, since traveling costs money. More so if you plan to relocate to another country for retirement – you’ll need a source of income if you finally go through with living in the French countryside or your favorite beachfront getaway.
Retirement is an exciting time. Planning ahead will help you make the most of it.