Getting ready for retirement is an exciting milestone. Whether your retirement vision includes traveling the world, launching a passion project, or simply enjoying more time for your favorite hobbies, turning that dream into reality takes more than just imagination, it requires thoughtful planning and informed decision-making. Gone are the days when decades of service guaranteed a gold watch and a steady pension. Today, it’s up to you to determine how much to save, how to invest and manage those savings, and ultimately, how to get ready for retirement in a way that supports the life you’ve imagined.
To help ease the transition from earning a paycheck to living off the wealth you’ve carefully built, we’ve created a retirement preparation checklist. It’s designed to guide you through the critical financial, healthcare, legal, and lifestyle steps you’ll want to address ahead of time. Our checklist reviews the essentials to help you understand why having a personalized retirement plan matters, and to give you the confidence so you can move forward with clarity and peace of mind.
How to Get Ready for Retirement
If retirement is on the near horizon, whether you’re five years or five months away, it’s time to fine-tune your plans and evaluate what needs to happen before your last day at work. Getting ready for retirement isn’t just about having a large nest egg; it’s about understanding how your finances, healthcare needs, and daily lifestyle will shift. Let’s take a closer look at the first two steps in how to get ready for retirement effectively.
Understand Your Retirement Income Needs
Start by estimating your post-retirement expenses. These may include housing, food, travel, healthcare, hobbies, and more. A common rule of thumb is that retirees should expect to need 70-80% of their pre-retirement income annually. However, your individual lifestyle and goals may shift this number up or down. Now is also the time to revisit your monthly budget. Getting clarity on your cash flow needs will help you evaluate whether your current savings and income streams will support your desired lifestyle.
Assess Your Sources of Income
Review your income sources which can include things like: Social Security benefits, pension income (if applicable), investment accounts (401(k), IRA, brokerage), annuities or rental properties, and part-time or consulting work. Knowing where your income will come from is a critical part of how to get ready for retirement. It also helps you identify whether any income gaps exist and how to close them.
Your Step-by-Step Pre-Retirement Checklist
Getting ready for retirement can feel overwhelming. Use our detailed retirement checklist to help ensure you’ve covered all the key areas of retirement planning:
1. Review Your Retirement Accounts
Take inventory of all your retirement accounts, including traditional IRAs, Roth IRAs, and employer-sponsored plans like 401(k)s or 403(b)s. Confirm your asset allocation reflects your risk tolerance and timeline. As you near retirement, you may need to shift toward a more conservative investment mix.
Make sure you’ve consolidated old accounts where appropriate and understand your Required Minimum Distribution (RMD) obligations, which typically begin at age 73.
Did You Know: According to the U.S. Bureau of Labor Statistics, as of 2023, the average Baby Boomer (born between 1957 and 1964) has had 12 different jobs over the course of their career, often leaving behind multiple retirement accounts in the process. Keeping track of them all is essential for effective planning and distribution in retirement.
2. Create a Retirement Income Strategy
Decide how and when you’ll begin drawing from your various income sources. For example:
- Will you take Social Security early or wait until full retirement age?
- Will you withdraw from taxable accounts first, or tap tax-deferred accounts?
A thoughtful income strategy can reduce taxes, stretch your nest egg, and help protect against market downturns.
Did You Know: Nearly half of retirees lack a formal withdrawal strategy, opting instead to withdraw funds as needed. This approach can lead to inefficient tax outcomes and a higher risk of depleting savings prematurely.
3. Evaluate Your Health Care Options
Healthcare is often one of the largest, and the most difficult to predict, expenses in retirement. As you get ready for retirement, understanding exactly what Medicare covers and what it doesn’t is essential. You’ll want to:
- Enroll in Medicare during your initial enrollment window.
- Consider a Medigap policy or Medicare Advantage Plan.
- Budget for out-of-pocket expenses such as prescriptions, vision, dental, and long-term care.
If you’re retiring before age 65, explore COBRA coverage, spousal coverage, or health insurance through the ACA marketplace.
Did You Know: A 65-year-old retiring in 2024 can expect to spend an average of $165,000 on healthcare expenses throughout retirement. This figure includes costs for Medicare premiums, deductibles, and other out-of-pocket expenses, but excludes long-term care.
4. Pay Down or Eliminate Debt
Carrying debt into retirement can create unnecessary stress. Try to eliminate or reduce:
- Credit card debt
- Personal loans
- High-interest balances
- Mortgage (if possible)
Being debt-free (or close to it) provides peace of mind and greater flexibility.
Did You Know: According to Nationwide’s ninth annual Advisor Authority study, 26% of retired investors continue to pay off their mortgage, and 25% are still paying down credit card debt. These ongoing financial obligations can impact the quality of life during retirement.
5. Plan for Taxes in Retirement
Taxes don’t stop in retirement. In fact, your withdrawals from tax-deferred accounts like 401(k)s or traditional IRAs will be taxable. You may also owe taxes on a portion of your Social Security benefits and capital gains.
Working with a fiduciary financial advisor can help you build a withdrawal plan that minimizes taxes and supports long-term wealth preservation.
Did You Know: In certain scenarios, retirees in the 22% federal tax bracket could face a marginal tax rate as high as 40.7% due to additional retirement income causing more of their Social Security benefits to become taxable.
6. Review and Update Legal Documents
An important part of getting ready for retirement that often gets ignored is ensuring your legal documents are in order. This includes:
- A will
- Power of attorney (financial and healthcare)
- Health care proxy and living will
- Trusts (if applicable)
- Beneficiary designations on all financial accounts and insurance policies
These documents should be reviewed every few years by a professional, and especially after major life changes, to ensure they still reflect your wishes.
Did You Know: As of 2024, only 32% of Americans have an estate plan in place; a 6% decrease from the previous year. This decline highlights the importance of regularly reviewing and updating your legal documents to ensure they align with your current wishes and circumstances.
7. Think About Your Lifestyle in Retirement
What do you want your day-to-day life to look like? Consider questions like:
- Where you want to live (downsizing, relocating, aging in place)
- Travel or hobbies you want to pursue
- Volunteer or part-time work opportunities
- How you’ll stay active and socially connected
Having a clear lifestyle vision can help guide your financial decisions and bring excitement to the planning process.
Did You Know: A recent study of 2,000 Americans who retired or plan to retire between 2020 and 2029 found that 60% intend to reinvent themselves in retirement, with many pursuing new interests and personal growth. Additionally, 59% plan to travel more than they did during their working years.
8. Set a Retirement Date and Timeline
Having a specific timeline gives structure to your planning. Once you’ve selected a retirement date, you can:
- Notify your employer and understand benefits like unused vacation payouts or retiree healthcare options
- Set a transition plan
- Begin mentally preparing for life beyond your career
Did You Know: According to a 2023 Retirement Confidence Survey, 46% of retirees left the workforce earlier than planned. Among those, 35% cited health problems or disability, and 31% pointed to changes at their company as reasons for early retirement. This highlights the importance of setting a retirement date and timeline to prepare for unexpected circumstances.
9. Consider the Emotional Side of Retirement
While the numbers are critical, it’s also important to prepare emotionally. Retirement is a significant identity shift for many. Think about things like:
- How you’ll maintain a sense of purpose and fulfillment
- What your daily routine might look like
- How you’ll stay socially connected and mentally stimulated
This transition can be exciting, but it’s also normal to feel uncertain. Talking to a trusted advisor can provide valuable support.
Did You Know: Nearly one in three retirees report feeling depressed, often due to the loss of routine and direction after leaving the workforce. This highlights the importance of preparing emotionally for retirement, not just financially.
Get Retirement Ready Today!
Getting ready for retirement is about more than just hitting a savings number; it’s about preparing for a new chapter of life with clarity, confidence, and peace of mind. From your finances to your healthcare, legal documents, and lifestyle vision, every piece plays a vital role in supporting your future self.
Whether you’re wondering how to get ready for retirement or you’re ready to put your plan into action, at R.W. Rogé & Company, Inc., we offer personalized guidance to help you Plan, Achieve, and Live® the life you desire.
We invite you to connect with our team and take the next step toward a financially secure and fulfilling retirement with a complimentary discovery call. There is no cost or obligation, so let’s start the conversation; your future depends on it.
If you have any questions or need personalized retirement planning guidance, we invite you to connect with our team and take the next step toward a financially secure and fulfilling retirement with a complimentary discovery call. There is no cost or obligation, so let’s start the conversation; your future depends on it. Our team of CERTIFIED FINANCIAL PLANNERTM (CFP®) professionals would be happy to assist, and can show you how our financial planning process can help you stay on track to achieve your financial goals. Please contact us for a complimentary discovery call at 631.218.0077. You can also send us a message directly.
R.W. Rogé & Company, Inc. is an independent, fee-only financial planning and investment management firm serving clients locally and virtually across the country, with Long Island, New York, and Beverly, Massachusetts office locations. R.W. Rogé & Company, Inc. was founded on a “client first” culture and proudly commits to acting in your best interest as a fiduciary. We have helped clients Plan, Achieve, and Live® the life they want since 1986. To learn more about how we do this, explore our detailed overview of services and approach.
