If you are someone entering your retirement years, then it might be time to start planning for your life beyond retirement to ensure that you have a fulfilling and sustainable retirement life. While it may be true that it is difficult to predict our future needs, that makes it all the more important to be prepared for any events that take place in the future. Read on for a retirement checklist that includes everything a person should take care of before officially entering retirement life.
Assessing Your Financial Health/ Assets
Before entering retirement life, the first big step to take is to assess your current financial health. Evaluate and work out the budget you have and estimate your total assets when retirement comes. Be sure to factor in every asset or liability you have, including debts, income streams, insurance policies, retirement savings, and others alike. After which, you will be able to make better financial decisions when retirement comes. According to the Bureau of Labor Statistics, records have shown that the average American over the age of 55 spent approximately $67,192 in 2020, while those over the age of 65 spent approximately $48,872 annually.
Building Up an Emergency Fund
Apart from factoring in your daily living expenses, it is also highly advisable for you to build up an emergency fund to better prepare yourself for any unforeseen circumstance. A financial security blanket will set you up for rainy days. Most experts recommend that you set aside three to six months’ worth of living expenses as emergency funds. Be sure to keep your emergency funds somewhere safe and secure, but separated from your savings account so that you won’t be tempted to spend them. It is highly recommended for you to keep them in a money market or passbook savings account since they are both significantly liquid but still yield interest.
Determining Retirement Needs
Envision the type of retirement life you would want and subsequently plan around that vision. Consider the ideal type of lifestyle you want to lead and whether or not your residence allows for that to happen. For example, those that want to live a less mundane, but fulfilling and exciting retirement life may want to consider moving into retirement communities like Conservatory At Plano, where a wide range of events and activities are always lined up daily for residents to take part in.
Reinvesting Your Investments
If you are someone that has been an active investor or trader, it is highly recommended to adjust your investment portfolio to one of lower risk tolerance. With the absence of a steady income stream, it is best to keep a safer portfolio. With the right financial planning, a small return on investment on safe investments is usually a much better choice as compared to betting on risky investments to make a big profit.
To sum it up, you should have a financial plan in place to follow for your retirement so that you can enjoy retirement life with peace of mind.
