Retirement Planning Steps in Your 50s
To get you started, here is a hypothetical timing schedule. If you are 50 or older, you need to condense retirement planning steps into a shorter span of time. Either way, they can act as a guide. It is never too late to design a retirement strategy.
Early financial planning is best. An ideal time to start serious financial planning for retirement is between the ages of 30 and 40. This means deciding which financial vehicles (retirement investments, annuities, etc.) to select to supplement Social Security and employer-sponsored retirement plans. The sooner you start building your private pensions nest egg, the more it can grow while you are living out your full-time career. And don’t forget, whether early or late, partners should always work as a team!
Preliminary investigation can help motivate your present career. Forty is not too early to start a research and development file on what you might want to do in retirement. What are your personal goals? Can you make retirement the most rewarding period of your life?
Some major decisions can be made in advance. When you reach 50 (or before) it is time to start making your retirement goals a reality. For example, if you decide you want to retire in a home by a lake, this may be the time to buy the land. If you want to live in a protected community with a golf course, you can buy now, use it as a vacation home or rental, and make a permanent move later. This is also an excellent time to plan vacations with your retirement location in mind, or you can live full time in RV. Also, if you have not had a solid physical exercise program and a good diet, now is the time to act. You don’t want to approach or enter retirement out of shape.
Review and implementation time. When you get within a few years of retirement, it is time to bring your financial plan and dreams into sharper focus to see if they will accommodate your tentative retirement date. After adjustments have been made, you should develop the confidence to set a final date and move ahead. You will know whether to keep or sell the old homestead, how to shed unnecessary possessions, and so on. Getting ready for the kind of retirement you desire often means taking several steps ahead of time. You need to address questions such as whether one partner will retire first.
Finalizing. Save the last year or two before retirement to wind things up. Fine-tune any plan you started earlier. Bring your financial program up to date. Make adjustments based upon economic, family, and other changes. Knowing you have a sound, updated blueprint to follow helps your attitude. It helps you get pleasure instead of pain from this final stage in the planning process.
All retirement plans, partial or completed, require frequent adjustment to compensate for change. But the evidence is strong that those who enter the preparation process with a good attitude have more successful retirements. They not only have a more open mind as they do their preparation, but they make better adjustments after the plan has been launched.