Retirement can mean a lot of different things to different people. Some people might look at retirement as a certain age when someone stops working while others might look at it as a monetary amount they have achieved. Some people might envision retirement as a time to travel and see the world while others might see retirement as a time to stay home and be close to family.
Whatever your idea of retirement might be, it is important to ensure that you are emotionally—and financially—ready for this next stage of life. This can be a complicated topic, and with the changing times we are living in, it is even more important to seriously evaluate or reevaluate your retirement goals, thoughts, and feelings. To help you figure out if you are ready for retirement, here are a few questions and considerations to keep in mind:
What does your retirement look like?
When trying to plan for retirement, it is important to think through what retirement means to you. Envisioning your personal goals for retirement can help you pinpoint if and when it will be the best time to retire. For example, if one goal is to help care for grandchildren at retirement, consider timing retirement to when your help would be needed most—are grandchildren already on the way, or perhaps not expected for another 5 years? Or, if a goal is to see the world or purchase a second home, there will be expenses you need to plan for now. Evaluating those goals against your overall financial situation will help ensure that you are financially prepared before exiting the workforce.
Are you financially ready to retire?
The thought of finances is one of the first things that comes to mind for many when the topic of retirement is brought up, and rightfully so. Ensuring you are financially prepared to live the lifestyle you want is key to having an enjoyable retirement. Retirement should not be spent worrying about finances, which is why we recommend consulting with an experienced financial advisor ahead of time to make sure you are on track to meet your goals. Your financial advisor will help you understand the variables of retirement planning including assets, retirement income, tax rate and most importantly, life expectancy.
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What are your options?
Many times, the topic of retirement might be thought of as a time when someone stops working completely; however, there are many different options that should be taken into consideration. For example, if you are planning to transition from working full time to not working at all you may wonder how you will utilize your new free time or how you will deal with not interacting with people on a daily basis at work. Perhaps one consideration would be to transition to part-time work, instead. Another option would be to review your hobbies to see if there is an opportunity to optimize a hobby into a second career, whether part time or full time, during retirement.
After reading through the above questions and considerations, do you have a better idea of what your retirement might mean for you and when you might be ready? It can take some time to think through, so do not get discouraged if you are still unsure. This information can, at the very least, help to guide your thought process so you can make an educated decision when the time is right.
There is a lot to consider when putting together a retirement plan, and at Bill Few Associates, our financial advisors have the experience and knowledge to help. If you have questions about retiring or your overall financial plan, call us today at 412-630-6000.
