You’ve spent your entire life working hard, and now the time has finally come where you’re starting to seriously consider retirement. While it is always an exciting time in anyone’s life, it can also be an overwhelming one. That’s because there are likely many questions you still have about your retirement strategy, and you want to have confidence knowing your finances can support this next chapter of your life.
The Kansas City retirement planning experts here at OWLFI want to ease any concerns you might have, which is why we’re happy to provide these helpful tips for what to do when you’re nearing retirement.
Steps to take when you’re about ready to retire.
Start planning for retirement needs.
To understand whether you are financially ready to step away from the workforce, you first need to know exactly what your expenses will look like after retirement. To do this, you must perform a thorough assessment of your post-retirement plans.
This includes factors such as where you plan on living, whether or not you want to downsize your home, how you’ll manage healthcare-related costs, and if you’ll want to work part-time or not. If you’re unsure of where to begin in this process, reach out to our Kansas City retirement planning professionals and let us help.
Maximize your retirement account contributions.
As you near your retirement age, start increasing how much you put into your various accounts with each paycheck you receive. While this is true for any IRAs you may have, it’s especially impactful if you have an employer matched 401K.
Every cent that they match is basically free income, and it will build a larger portfolio with more profitable returns. This strategy is also helpful because, for many people, this is the time of your life where you are making the most money, so you’ll be able to build a nest egg that’ll last well through retirement.
Increase your cash reserves.
While continuing to build your retirement accounts, you should also start focusing on creating a cash reserve in the form of savings, checking, and money market accounts. This is important for multiple reasons.
First, you will likely run into some delays when setting up withdrawals from your retirement accounts or getting your pension in order, so this ensures you are covered in the interim. Second, having cash reserves means your life savings aren’t tied to market volatilities that can affect your financial planning.
Understand the best social security strategies.
Once you turn 62, you become eligible to start receiving your social security benefits. However, beginning to draw the benefits immediately might not make the most financial sense. That’s because every year you delay filing your claim up to age 70, you’ll get an 8% increase in the amount you receive.
Factors like your financial security, health status, and retirement plans will determine when the best time to start collecting is, but our Kansas City retirement planning team can help you make that determination.
Are you ready to start your retirement planning in earnest?
Then contact the team here at OWLFI. With years of experience providing Kansas City’s premier retirement planning services, our experts have the knowledge and expertise needed to help you navigate through the complexities of preparing for the next step in your life.
We understand the best strategies to provide financial certainties, and we can tailor an approach that perfectly aligns with your unique goals for retirement and current financial situation. If you want to learn more about how we can help, read about our retirement planning services or simply send us a message to schedule your initial consultation.