Retirement Planning Guide for Seniors
Written by: Daniel Gleich
For many, retirement is something to look forward to after years of employment. People often see it as a new chapter in their lives and a time to enjoy the freedom that comes from permanently leaving their job. As exciting as it may be, though, it can also be frightening. Before entering retirement, one should give it careful thought and create a plan that will help ensure that it’s an enjoyable experience.
To start, people should figure out what their retirement goals are. Having a goal can help determine what one’s ideal retirement lifestyle looks like. Goals can help people see a bigger picture regarding what they want to experience or accomplish during this stage of life. Seniors whose goal is to see more of the world, for example, may ultimately choose a lifestyle of travel. Another person’s goal may be to pursue a passion and start their own business or live a more quiet, leisurely life away from busy cities.
Where a person lives after retiring plays a big role in their lifestyle. A retired individual or couple may want to move closer to family, to a new state, or even to a different country altogether. Family homes may feel too large or empty for retired couples, and seniors may find living in a smaller home less expensive and less work in terms of upkeep. But for others, particularly those who have paid off their mortgages, moving may not even be a factor.
One’s health is a big consideration if contemplating a move during (retirement). People in good health may look to active adult communities as an option. Unlike other neighborhoods, these communities include houses, apartments, and condos that are only for active people over a certain age. Another option retirees may consider are independent living communities that offer services such as food, housekeeping, and even transportation.
Deciding on a lifestyle, however, is just one step. People will also need to determine if they’ll have enough income to live the life that they want and to reach their post-retirement goals. To start, they’ll need to estimate what their income will be. Things to consider include Social Security benefits, 401(k)s, IRAs, and any other savings plans that may be in place. People should also look at how their annual or monthly expenses, such as gas or other daily transportation costs, will decrease after retirement. New and increased expenses are another factor to consider; for example, an employer will no longer pay for health insurance premiums.
Once an estimated income is set, the next step is to estimate how much one will spend on housing, food, and other general expenses. People should also keep in mind that unexpected events and expenses may arise that take a toll on one’s finances. Experts recommend setting aside enough to cover a minimum of three months’ worth of expenses.
At this point, one should know whether their income will be enough to cover their retirement expenses and allow them to live the life they want. If the results aren’t favorable, it may be necessary to look for additional sources of income or make adjustments to one’s plan.
Learn the best way to make the right retirement choices with these resources:
- Ten Retirement Lifestyles Worth Trying: Retirement is the opportunity to envision a new lifestyle for many retirees. This slideshow features ten ideas that range from living near a beach to becoming an entrepreneur.
- Retirement Life and Leisure: Seniors looking for help on how to plan life after retirement can click this link for helpful tips and a retirement lifestyle checklist.
- Finding Meaning and Purpose After Retirement: By clicking this link, retirees will learn about the importance of having meaning and purpose in their life. The page also provides readers with information on ways to stay active and social without stress or financial strain.
- How to Plan Your Retirement Lifestyle: This page poses questions that can help seniors plan their retirement.
- 19 Tips for an Amazing Life After Retirement: Retirees who click this link will find tips on how to live their best life.
- Learn About Retirement Benefits: This Social Security Administration page teaches seniors when to plan for retirement, how benefits work, and when to start them.
- How to Estimate Your Retirement Expenses: Soon-to-be retirees who click this link will find information on how to estimate retirement expenses.
- How to Take Responsibility for Your Retirement: Money is a common concern for people planning their retirement. This page on the Internal Revenue Service site provides seniors with helpful financial tips.
- Budgeting for the Four Financial Phases of Retirement: There are generally four phases associated with retirement, starting with pre-retirement and ending with late retirement. On this page, people are given budgeting advice for each of these phases.
- Retirement Need Analysis: How Much of My Current Income Will I Need for Retirement? This page will help people better plan their retirement by determining how much money they will need.
- Taking the Mystery Out of Retirement Planning: Open this link to the Department of Labor Employee Benefits Security Administration (EBSA) website to find a 63-page workbook on retirement financial planning that includes worksheets and a list of important resources.
- What Is Rightsizing? Relocating is a common consideration for many seniors who are planning their retirement.
- Housing Options for Seniors: Click this link to learn about the different housing choices that are available for retirees.
- The Relocation Decision: AARP uses this page to discuss moving as an option for seniors and how to master hunting for a new retirement home.
- Retirees and Their Homes: They Want it Their Way: Read an article that discusses how and why seniors relocate or don’t.
- Aging in Place: Growing Older at Home: Not all seniors choose to relocate when they retire. This National Institute on Aging page provides information that includes common concerns and available support for people who decide to stay in their homes.
- Unexpected Retirement Expenses and How You Can Prepare: Retirement often comes with additional expenses that can catch seniors by surprise.
- Retirement: Plan Ahead for These Five Nasty Surprises: Emergencies can drastically disrupt one’s retirement finances.
- How 401(k) Plans Work: Watch this video that explains 401(k)s and how to use them.
- Four Big Expenses You Could Face in Retirement: This ABC News article reviews five of the largest expenses retirees may face, from dental care to prescriptions.
- Retirement Planning Tips for Women: Women who are planning their retirement will find information on saving in advance and tips on how to get the most out of retirement income here.
- Living Well in Retirement: ACL’s Resource Centers on What’s Important, the Biggest Challenges, and Resources to Help: Open this Administration for Community Living page to read retirement-related tips and information from four centers for seniors, including the National Pension Assistance Resource Center and the National Resource Center on Women and Retirement.
- Retirement Planning Guide: This planning guide takes seniors through the stages of planning their retirement.
- Expect the Unexpected: With people living longer than they did in the past, they are more likely to run into surprise expenses like those associated with medical care.
- Three Unexpected Sources of Retirement Income: Fox Business outlines three different sources of income for seniors who are struggling financially.
- Adjusting to Retirement: Handling the Stress and Anxiety: Some people may find it difficult to adjust to retirement living. People struggling emotionally with being retired will find this to be a useful source of information on how to adjust and how to handle anxiety and stress.