Before You Retire
If you are considering retiring, you might want to start interviewing financial advisors. Retirees often come to me a few years into their retirement not understanding their current expenses, debts owed, the pension elections they choose, or how much they can withdraw from their accounts. Mistakes that have lifetime consequences have often been made that leave little room for repair.
Although it is never too early to start working with a financial advisor, 5 years before you want to retire is critical. Budgets should be reviewed or created if one doesn’t already exist, changes implemented, and goals defined. Debts should be looked at and debt reduction strategies should be put into place. Your current investment allocation should be closely looked at to determine if the risk level is appropriate for your goals and future income needs.
A lack of planning often creates a situation where the retiree is in serious risk of outliving their income, or needs to reduce their standard of living in order to not outlive their income. The result is a retirement that isn’t what the retiree envisioned for their life.
The bottom line – if you want to someday retire, the sooner you start planning the more realistic retirement will be.
|