Retiring is a major life decision and sometimes it’s a struggle to navigate when the absolute right time to retire is. It’s not a decision to make hastily, but it’s also not one you want to sit on for too long. If you’ve been mulling over the factors that go into retirement including your asset allocation, social security, and your financial plan for life post-employment, you may be closer than you think. Here are four surefire ways to tell that you’re ready for retirement.
You’re Debt Free
We all know the most important part of retirement is ensuring that you’re financially stable enough to do so. If you’ve paid off all of your debts, you’re well positioned for retirement. In order to live comfortably during your retirement years your nest egg has to be plentiful and ready to provide for you while you’re not working. It may sound obvious, but being in debt doesn’t allow your nest egg to feel comfortable whatsoever during this stage in your life. Being in debt while retired is a major detriment to your livelihood, so it’s imperative that if you’re planning to retire that you pay off all of your debts. You should also be sure that you’re not supporting children or other any other family members if you’re planning on taking this next life step. It’s time that your money starts supporting you and you alone. If you’re still financially supporting family members during retirement you could look at that as another form of debt. The only individuals who touch your money after you retire should be you, your spouse, and your financial advisor.
You’ve Created a Retirement Budget
If you’re a planner, you’re most likely ahead of the game with this one. Surprisingly so, a lot of pre-retirees don’t even think to crunch the numbers before they take the big leap. You have to take a lot into consideration when you start planning your finances during retirement. It’s time to start adding up your monthly costs including rent, groceries, utilities, and other expenses. After this is done and you’re feeling comfortable with where you’re at, you can start adding in your “wants” including travel, leisure, entertainment, and dining out. At this point you’ll be able to start calculating how much you’ll still need in income on top of your savings. This is where factors such as income planning and securing your social security benefits come into play. There are a lot of factors that come into account when planning out your social security benefits including hitting your full retirement age, how many years of employment you have under your belt, and extra benefits you may be entitled to in order to make the most of your social security checks. Planning out your income ahead of time will help with your budget greatly.
You Have a Plan for Post-Retirement
If you already have your retirement years mapped out after you’ve been relieved of all your debts and you’re financially prepared for the future, you’re probably itching for retirement to just come already. If you’re at this point but aren’t quite sure how you’d like to spend your retirement years, it’s time to start thinking about it. This is the fun part! Traveling is typically the first thing that comes to mind when thinking of how to fill your time. Use this well-deserved time to relax on a beach, immerse yourself in another country’s culture, or maybe even backpack through Europe. You could also use this time to dive into your hobbies full-time or take classes to spark a new passion that you didn’t know was there. Popular hobbies among retirees include gardening, cooking, pottery, writing, and so much more. These hobbies keep your hands and minds nimble as you ease into your new lifestyle. Finally, there’s no better time to connect with family. Working occupies a lot of precious time that you could be spending with your family. Your retirement years allow you to make up for this lost time. Take your family on your travels, invite them over for dinner made from your new garden, or have them tag along to your next pottery class. Take this time to do everything you’ve wanted to do during your working years.
You’re Emotionally Prepared
This is a big one. Even if you have everything lined up and ready to go for you to retire, you need to make sure you’re emotionally prepared to do so. You spend about one-third of your entire life working. Working is something that’s been a part of your day-to-day routine for decades and then one day, it stops. This huge life move is absolutely bound to put you in some state of shock. It’s absolutely normal to grieve your working life as you transition into the next stage in life. A lot of individuals tie their work into who they are as a person and how they go about their social lives. If this is you, you need to start mentally preparing for how much this may affect you. Make sure that you make it a point to stay in touch with your colleagues and your work friends if this is something that’s important to you. Just because you’ve finished working doesn’t mean you need to give up what makes you happy. Retirement is as exciting as it is worrisome. Plunging into the unknown can be stressful but a little preparation goes a very long way.
At Bridgelight Financial Advisors we make it one of our top priorities to ensure our clients are prepared in every way for retirement. If you are in need of a financial advisor that specializes in helping you make your retirement a successful one, our team at Bridgelight Financial Advisors would love to help you experience confidence in every aspect of your financial plan. Call (203) 795-7080, email Advice@BridgelightAdvisors.com, or schedule an appointment online to meet and get started.
About Bill
Bill Leavitt is the president of Bridgelight Financial Advisors, an independent, privately owned fiduciary financial advisory and financial planning firm. He specializes in working with pre-retirees, retirees, professionals, and women investors, helping them navigate a complicated and ever-changing investment landscape. With over 25 years of experience, Bill serves his clients using his own unique financial planning model, The Wealth Focus™ Process, where he helps clients develop their customized long-term wealth strategy in four comprehensive steps. A Connecticut native, Bill resides in southern Connecticut with his wife, Laura, and their three daughters. To learn more about Bill, connect with him on LinkedIn.