What kind of retirement do you want?
Preparing for life’s later years requires you to look at many personal and financial details. To live the retirement lifestyle you imagine, make decisions about how you want to live and base your financial planning on your preferred lifestyle.
Consider these four questions to get started.
- How do you want to spend your time?
Some retirees capitalize on their years of experience by transitioning to a new work arrangement that enables them to earn income without the demands of working full time. Examples could include working part time or seasonally, being a consultant in your field or applying your skills to a new endeavor. If you prefer to stop working entirely, explore your options, like volunteering or pursuing personal hobbies. Before you retire, try to devote blocks of time to these activities to decide if you would enjoy them routinely.
- Where do you want to live?
Review your preferences for your immediate environment. Things like climate, cost of living, proximity to loved ones and recreational opportunities may come into play. For example, do you prefer the action of a large city or the quiet of the countryside? Do you prefer the independence of a single-family home, or would you be happier in an apartment or condo with neighbors down the hall?
- What resources (financial and other) are available to you?
Financially speaking, your options for collecting Social Security or converting assets to a stream of income may influence your retirement planning. Your personal support network is also a factor. For instance, nearby friends or family members who share your interests may make it easier to arrange a stimulating social calendar. In contrast, individuals whose personal identity or social network are rooted in their job may feel more fulfilled pursuing activities that build on career skills.
- What preparations do you need to consider prior to retirement?
Create a budget that considers the ongoing living expenses associated with your desired retirement lifestyle. A budget can help you determine whether your financial resources are adequate or whether you need to modify your plans.
Reviewing your personal and financial objectives at the same time may help you create a retirement that’s one of the most fulfilling times of your life.