There’s no doubt that retirement planning is always a prudent idea. The earlier the better is a good motto to adopt where transitioning from the daily grind of a workweek to the more relaxed golden years. The more prepared the less you’ll have to do as you prepare for the home stretch.
Eliminate debt – Pay off debt quickly especially those that are hedged against your 401k-retirement plan. If you don’t you run the risk of paying them out of your savings or other investment and that’s not a good idea for a retiree.
Get the paperwork in order – Try to get all the necessary paperwork in order 18 – 24 months before your scheduled retirement. Items to pay special attention to would be original birth certificates; update passports and other identity papers will help your transition into retirement much smoother.
Health Care – Health care coverage is always a big concern for retirees so be sure to find out how your health care coverage will change once you’re separated from the company. You may find out that you will need to seek additional insurance to be adequately insured. Also, if you have special ailments that you current insurance doesn’t cover be sure to take this into account as this may eat up a large part of your retirement income.
Budget for expenses. Make sure you are aware of your total income from all sources when you retire as well as your expenses. Call the social security administration to see how much of your pre-retirement you can expect after you retire. Some of your expenses will fall away such as the commuting expense.
Make adjustments for new tax bracket. Contact your tax advisor and get the appropriate forms you’ll need to submit to adjust the taxes withheld to mirror your retirement income. Switching from a salary to retirement income is a bit of adjustment as far as tax liability is concerned so you want to be sure you’re prepared.
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