Countdown: Five Years to Retirement
Category: Checklists
July 10, 2018 — Think of your retirement as if it were a rocket poised for liftoff at Cape Canaveral. You, flight safety, are going through an elaborate countdown, ticking off countless items from exhaustive checklists. Only when everything is lined up properly is permission granted for your retirement launch!
In this piece we’ll go through a five year countdown to retirement, an excellent idea developed in a NY Times feature last week by retirement expert Peter Finch. Without first looking at what he proposed, we took our own crack at this countdown idea… and look forward to comparing notes (a link to his article is at bottom).
Five, four, three, two, one – retirement blastoff!
Although we have tried to concentrate each year on one major task, that doesn’t mean you should not be thinking about other planning aspects. This is a suggested timetable – you don’t have to be rigid about which planning area gets emphasized each year – but these are the important areas to consider. What is important is to tackle all the key planning bases with the remaining time you have before “blastoff”. Think where you live now is the best place for you to retire, and don’t need to bother? Going through this planning process helps guarantee that as a mindful decision, rather than planning by just letting things happen.
Five years out – Finances rule
Your most important task this year is prepare a financial balance sheet that shows what your expected income will be compared to your retirement expenses. By taking a serious
Comments on "Countdown: Five Years to Retirement"
LS says:
The Times article briefly mentions it but I would pay more attention to home renovation as I get near to retirement if you intend to relocate. We have a 20 year old suburban 5 bedroom house that we built. Many styles, technologies and furnishings have changed over that time. We are going to downsize and maybe relocate so several years ago we began to update and repair/renovate our house to be ready to sell when the time came. This can be a lengthy and time consuming process. For instance, does you house need a new roof, replacing carpeting with hardwood floors, new stainless steel appliances, new furnace/AC system, tankless water heater, stand alone tub and tub filler, painting inside and out, etc? How about the outside? Is the fencing in good shape? A good looking front lawn is important and attractive shrubs and flower beds. Is your deck/patio and pool in good repair? Many of these repairs/renovations are quite expensive so I would start them while you are still working and can pay for them easier. To get started, go to new home displays to see what builders are putting into homes in your price range or do online research. See where your house needs to be updated and get started because it won't get done overnight.
Editor's comment: Great points LS, thanks!
Kris says:
Once we narrowed down our search of places to retire we also consulted our CPA who prepared "what-if" state and local tax returns for each location choice based on our anticipated retirement financial sources. Taxes paid on retirement income often are not a consideration in retirement planning and can be a real budget surprise AFTER you have relocated to a different state.
AJ says:
Interesting article. I'm 18 months from blasting off and can't wait!
Articles have general advice and one should not take these guides as rules. While I agree totally with the financial planning, the relocation needs further consideration. There is no urgency to move just because one retires. In fact, depending on the demands of the job being left, there is good reason not to move right away. For instance, in my case, the human interaction stimuli is extremely high. At this point, I just want to move further out in the country on more land. Rather than run for the hills, I've decided to wait a year afterward to find out how many and how much contact with people is comfortable. Buying 20 acres on an island may be the worst mistake and who wants to move twice??
Other considerations are family dynamics and community relationships. Family is a non-consideration in my case but grandkids could be a huge consideration to others. One must consider how long and strong local ties are. If only moving across town, it isn't necessary to ponder but one should really look at all the casual relationships developed over the years on distance moves. An example is the woman running the produce market who knows my voice and will definitely have the box of Romas ready for me at the end of this month. What about the local contractor/handy man you can text and he practicality drops everything to fix a pipe or AC AND doesn't charge an arm for the prompt service? He does get real hot chocolate during the winter, though. ?
In other words, don't rush! Take one's time to analyze after retirement moves or decide not move at all.
Jennifer says:
Kris, where have you decided to end up after all the analysis? Your story was like a cliffhanger and I am sure many members of this forum are eager to know your chosen retirement destination.
Thanks