Planning Discussions - Are You Ready to Retire?
Wealth & Pension Services Group
William Kring, CFP®, AIF - Chief Investment Officer
02/28/14
Are You Ready to Retire? 5 Questions to Ask Yourself...
More than 3.5 million baby boomers will retire each year for the next 16 years. 70% of Americans are behind in their retirement savings.1 Many people are questioning their readiness to retire, and wondering how they can make it happen.
Before you enter retirement, ask yourself these 5 questions:
Q: Are my debts paid off?
A: For most people, income levels drop in retirement. It is important to consider your debts as you enter retirement. Do you have a mortgage and other unpaid debt to include in your retirement budget?
Q: Can I survive comfortably under a retirement budget for 6 months?
A: Give yourself time to adjust. Stick to a retirement budget for 6 months prior to retiring. If you can comfortably live without dipping into your savings, you may be ready to retire.
Q: Do I have reliable long-term health insurance?
A: Having adequate health insurance is an important factor to consider when entering retirement. Medicare doesn’t kick in until age 65 and rising insurance rates makes it imperative to have a consistent source of health care insurance.
Q: Am I ready to leave work?
A: Many retirees will miss their work. Part-time work is an option for some. As is dedicating time to a passionate cause. Maintaining a network of people is just as important in retirement as it is during professional life.
Q: Can I afford to maintain the lifestyle I desire?
A: Everyone’s lifestyle goals are different. There is no magic amount of savings you need to maintain a desired standard of living. Most formulas used to determine retirement readiness include current and future income levels. Do you know how much you need to save to live the lifestyle you planned? Retirement readiness is about getting answers to your questions and having a plan. Are you prepared to retire? We’re here to help.
Source: 1tiaa-cref.org