Four Steps to Get You Closer to a Stress-Free Retirement
While planning for retirement can feel like a never-ending, uphill battle, it doesn’t need to be. A comprehensive plan can be a lot to digest and easy to put off, but by starting with a few easy steps you are more likely to stop procrastinating and get to planning! Here are four steps to get you started.
#1 Decide How Much You’ll Need Year Over Year While Retired
The first step in knowing how much you’ll need to save for retirement is to decide realistically how much you’ll spend in a year. Start by considering your expenses now and the things that will change once you transition into a fully retired lifestyle. Discuss your essentials like food, housing, and healthcare, and include lifestyle expenses like trips, dining out, and gifts. Once you have a better feel for what you’ll need you can work with your financial professional to start developing plans for where this money will come from.
#2 Include Taxes
Though you will no longer be receiving a paycheck, taxes are still a major factor to consider for retirement and could sneak up on you as a large expense. Though the money you are getting is now in the form of Social Security benefits, pension payments, investing income, and retirement account distributions, they can still be taxable. Work to establish which of your income sources are taxable and which tax bracket you’ll likely be in, then start on a strategy for tax minimization.
#3 Reevaluate Your Estate Plan
What are your retirement plan documents looking like? Whether you have a will, trust, 401(k), or IRA, you have designated beneficiaries. But when is the last time these documents have been reviewed? A lot of life can happen quickly, like marriages, divorces, or the birth of kids and grandkids. It is important to take these changes into consideration and reevaluate your estate plans accordingly. Despite updates to your will or setting up a trust, you’ll still need to consider your retirement account beneficiaries because beneficiary designations trump will and trust directives.
#4 Come Talk to Us
Does this still feel like a lot? Do not fret, we are here to help! Whether you are a first-time retirement planner or just have updates you want to make, we can assist you in all areas. We offer no-cost, no-obligation initial meetings where we learn about your retirement goals and financial planning needs and are happy to talk with you as soon as you’re ready!
