7 step retirement planning checklist

7 step retirement planning checklist

Here is a 7 step retirement planning checklist for people getting ready to retire.

1) Income
I’ve learned that retirement is all about cash flow not net worth. So one of the most important first steps is to write down all of your income sources in retirement. You will want to consider pensions from your current or past employers, and Social Security benefits. Be sure to consider spousal benefits, survivor benefits and also explore strategies for maximizing your social security such as the file and suspend method or the restricted application. Examine tools such as social security income benefit calculators , Click here to listen to a recent radio interview I conducted with Kirk Larson who is the western Washington public affairs specialist for the social security administration on how to maximize your social security benefits, or watch the short video below on how to maximize your social security income.  Below are a few links you will want to consider.

  1. Social Security Income Benefits Calculator.
  2. Radio Interview with Kirk Larson from the Social Security Administration.


2) Assets

What assets do you have that will provide income for you. You want to consider any rental properties and provide net income. This is also where you will want to list out cash, investments and retirement accounts that can be used to help you supplement your income needs.

3) Budget
Having a good handle on your spending and knowing how much money you actually need every month to make the numbers work will help you craft an income strategy first for your needs and second for your wants.  Mint.com is a great free resource to help you track your spending.  Below are a few resources to help you with your budget in retirement .

  1. Click here for a budget data gathering form.
  2. Mint.com – An online tool and app to help with budgeting.
  3. Budgeting in retirement – A recent article I wrote on this subject.

4) Liabilities
List out all of the people who you owe money to.The retiree who does not owe anyone has the most flexibility and often the most comfort in retirement. A great goal before you retire is to be debt free.

5) Insurance
Do you own Life Insurance, Long Term Care Insurance, Health Insurance, Home Owners Insurance, Car Insurance, Earth Quake Insurance, an Umbrella Liability Policy, or ID Theft Protection? Which insurance do you need now that you are preparing to retire. List out all of the policies you own and then talk to an independent risk adviser who can help you understand what insurance you should consider. If you are going to be turning 65 soon and planning to enroll in Medicare be sure to check out their online tool to help you find the best plan for your situation.  Below are some links you may find helpful.

  1. Medicare’s online tool for finding the best medicare supplemental plan.
  2. My website for requesting – Long Term Care Insurance Quotes.
  3. The ID Theft Protection I personally own.
  4. Listen to a recent radio interview I recorded on Umbrella Liability Insurance.

6) Estate Documents
Is your Will, Power of Attorney, Health Care Directive, Trust and all other estate documents in good order and have they been updated recently? If not plan to meet with an attorney to get these important documents updated.  Below are links to a few radio interviews with local estate planning attorneys who answer many questions regarding Wills, Powers Of Attorney, Revocable Living Trusts, Health Care Directives and more.

  1. Listen to a recent radio interview I conducted with John Kenney who is a local Estate Planning Attorney.
  2. Listen to a recent radio interview I conducted with Richard Tizzano who is a local Estate Planning Attorney.

7) Taxes

It’s not how much income you have that matters but how much of it you get to keep after uncle Sam gets his slice. Be sure to bring your tax return to a CPA or an adviser that understands the tax code and can help you understand how much of your income is going to be taxed in retirement. It’s your net after tax income that will be the money you actually get to spend on the things that are important to you.