A complete list can be a big help in organizing your activities for the week or the month, but what about creating a "to do" list for long-term goals, like a comfortable retirement? The (Sterling, CO) Journal-Advocate provides a few list-worthy ideas to consider in “Here's your retirement 'to do' list.”
You should examine—and re-examine—your planned retirement age. You may have long expected to retire at a certain age, but be certain that it’s the best for your overall financial situation. If you enjoy your job and you stay for a few more years, you may dramatically increase the funds in your 401(k) or other retirement plan. You might also even be able to delay taking Social Security, which would mean larger monthly payments.
Your retirement lifestyle. Try to estimate the cost of your retirement lifestyle. When you know what your retirement lifestyle might look like, you can better calculate your costs and expenses. These figures will help you decide how much you’ll need to withdraw each year from your retirement accounts, like your IRA, 401(k), or other employer-based plan.
Your retirement plan. In addition to knowing how much you’ll need to withdraw from your retirement plans, you also must know how much you are required to withdraw. When you turn 70 ½, you typically must begin withdrawing money from your traditional IRA and 401(k) accounts. These required minimum distributions or “RMDs” are based on your account balance, age, and other factors. If you fail to withdraw the full amount of the RMD by the deadline, the amount not withdrawn will be taxed at 50% rate.
Your health. When you turn 65, you’ll likely be eligible for Medicare. However, you should understand the things that it does and doesn't cover, in order to create your annual health care budget. If you want to retire early, you may lose your employer-sponsored health insurance. You’ll need to be ready for the prospect of large out-of-pocket costs.
Long-term care. Remember that Medicare doesn't cover (or only covers a small portion of) long-term care. Look into a way to reduce your risk by speaking with a knowledgeable attorney.
Your estate plan. Estate planning can be complex, involving many different documents, like a will, a living trust, power of attorney, healthcare directive, and more. Discuss your needs with an experienced estate planning attorney to be sure that you're making the right choices for you and your family.
Check these items off your to-do list, and you’ll be better prepared to enjoy retirement.
Reference: The (Sterling, CO) Journal-Advocate (December 13, 2016) “Here's your retirement 'to do' list”