Retirement planning becomes crucial when there are just 10 years left before leaving the workforce.
Not everyone chooses to retire. I recently chatted with a cab driver in Washington, D.C., who shared that at 86, he has no intention of stopping his work. He enjoys engaging with visitors and has found purpose in his daily routine, which keeps him active and social.
On the other hand, some people want to retire and enjoy their later years. Recently, a member of our community asked what steps to take when retirement is approaching. This sparked an engaging discussion with numerous suggestions from others who are also considering their future.
Here are 10 valuable ideas for preparing for retirement a decade in advance, inspired by community members.
Explore Retirement Locations During Vacation
Thinking about relocating to a more affordable area later in life? It's wise to explore your options early, suggests Nyla N. “If you’re considering a move, start visiting potential locations now. After college, I always went where jobs were, but retirement allows me to choose freely, which is both exciting and daunting.”
Joslyn L. took the plunge and moved to Guanajuato, Mexico, a few years ago: “The climate is fantastic, no extreme heating or cooling needed. Plus, it’s walkable and has great public transport.”
Address Home Repairs and Updates Promptly
With rising costs, delaying home repairs may lead to even higher expenses later. “Pay off your mortgage and tackle major upgrades before retirement,” advises Shellie F. She highlights the importance of addressing costly repairs like windows and roofs now. Bonus: Enhancing your home’s energy efficiency can lead to immediate savings on utility bills.
Start Volunteering Early
Consider how you want to spend your time in retirement and begin integrating those activities into your current life. “Create a list of things you’ve always wanted to do and start now,” suggests Liz K. “This way, you’re actively shaping your future instead of waiting for retirement to begin living.”
Hospitals, schools, and community centers are excellent places to volunteer. Juli W. notes that volunteering not only helps others but can also improve your own longevity. Consider roles like organizing community gardens or keeping public spaces clean.
Prepare for Increased Healthcare Expenses
Healthcare costs are continuously rising. With expenses often outpacing inflation, planning for higher healthcare costs is essential. Even with Medicare, retirees can face significant out-of-pocket expenses. Research indicates that after accounting for these costs, retirees may only retain 71% of Social Security and 88% of their total income.
Leigh, a community member, switched to a high-deductible health plan two years ago to open a health savings account (HSA). “My goal is to fully fund it and use it for medical expenses in retirement,” she shares.
Maintaining physical fitness can also help manage healthcare costs, says Lyn L. “Focus on your health now so you can enjoy a higher quality of life later. Regular exercise and caring for your mental well-being are key.”
Establish a Social Network Beyond Work
Work relationships often don't translate into post-retirement social lives. If you retire before your colleagues, consider engaging in community activities to meet new people. Kathy L. emphasizes the importance of staying active: “I volunteered for Meals On Wheels for four years. Don’t just sit at home.”
Take a Retirement Readiness Quiz
If you enjoy quizzes, check this one out, suggests Tracy S. “It helped me prepare for my move to Panama.”
Review Your Pension Regularly
If you have a pension, it’s important to keep your information updated with the relevant agency. “Don’t wait to clarify your pension details,” advises Sophie T. “Some plans have strict rules on claiming benefits, so it’s best to be informed.”
Consult a Financial Advisor
“Meet with a financial advisor to understand how much you need saved for retirement and how long it will last,” suggests Lyn L. This helped her gain confidence about retiring early.
Tracy S. and her husband met with their financial advisor regularly for over a decade, which allowed them to save significantly and prepare for retirement. “We organized everything and set a date,” she explains.
If you haven’t yet found an advisor, here’s how to start.
Delay Social Security Benefits as Long as Possible
For each year you wait to claim Social Security from age 62 to 70, your monthly benefits increase by about 8%. Delaying can significantly boost your benefits, with some members sharing annual increases exceeding $3,600.
Create a Social Security Account
While discussing Social Security, several members recommend visiting the Social Security Administration’s website. It’s a useful resource for claiming your account, checking eligibility, and estimating your benefits as retirement approaches.
Articulate Your Goals
Speaking your retirement plans aloud can help solidify your goals. Some prefer visualization techniques, like placing reminders of their dream retirement spot in visible places. Tracy S. found that writing down their retirement date served as a daily motivator to keep them focused on their objectives.
