Six steps to help you prepare for your retirement

Portrait of a pensive businessman

Image: Minerva Studio/Bigstock.com

So, you’re thinking about retirement more than you have in the past. Have you thought about what you could be working on over the next 12 months? Here are six steps:

Step 1: When

I’m calling this Step 1, but I know some will want to look at finances before thinking about the ‘when’ of retirement. I suggest that a better way is to work out the ideal time for you to transition into retirement so you can work toward it. You can always come back and adjust it if you need to.

If you’re part of a couple, an important question to answer is: Will you both retire at the same time? If you don’t, how will you handle that?

Step 2: Finances

Do you have clear goals and methods for your finances?

If you have a financial plan for retirement, check it regularly (quarterly is good) to make sure it’s achieving what you want it to. And keep the big picture in mind. You’ll probably have superannuation, some savings, and perhaps some investments you’re working on.

Most of us don’t understand finances or the system well enough to plan effectively. If that’s your situation it’s worth searching out a financial planner to see how they can help you. You’ll find some tips here.

You may want or need to go on the Aged Pension. A planner can help you take the best approach possible. To get some basic information about understanding finances in retirement, go here.

One important goal most people desire is to own their home when they retire.

Step 3: Work decisions

How do you plan to stop work? Will yours be a December 31 stop with retirement beginning on January 1? Or do you want to work a day or two less a week for a time before retiring?

Then, answer the ‘why work part time?’ question. Is it because you love your job, or is it to help with your finances?

If you love your job and it’s central to your life? Why retire? You may want to join those who are Refusing to Retire for a time.

Step 4: What then?

Retirement is a transition that needs to be more than going from doing something to doing nothing. What will you actually do in retirement?

I’ve met people who have the big rigs and are spending months as grey nomads travelling around Australia. But then there are those who love to keep their gardens in top shape. Travel doesn’t have the same appeal for them.

This is the point. You are in charge of your life in retirement. This is a chance to follow your passions; to give back; to develop your interest(s); to serve; to learn; and so on.

When someone asks what you do, ‘I’m retired’ doesn’t answer the question. Retirement is meant to be more relaxing—less pressured—but it isn’t a state of nothingness.

Step 5: Health priority

How’s your health? Too often the focus on retirement is on finances, sometimes to the detriment of overall wellbeing. That’s dangerous.

The reality is that your health—physical, mental, and emotional—should be a top priority before retirement so you’re as fit as possible in retirement. There’s not much value in getting to retirement and not having the health to enjoy it. It’s important to ask what you need to do to build your wellness.

Try two basics: Eat well and move.

For movement, Darren Morton puts it this way: ‘Just start something. Put on your walking shoes and get out the front door. Once you’re on a roll, it’s easy to keep rolling.’

These five steps should help you as you prepare for your retirement. But I need to add one more.

Step 6: Write down your goals

There are several studies that demonstrate the value of writing down your goals. Gail Matthews from Dominican University conducted one of them. Basically, writing down your goals gives you a better chance of achieving them.

No matter how near or far away your retirement is, you need to plan for it. If you haven’t thought much about it yet, why not start now?

Bruce Manners is the author of Retirement Ready? and Refusing to Retire, and founder of RetireNotes.com

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Category: Lifestyle, Planning

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