Retirement preparation requires coordinated decisions about finances, health, estate administration, risk management, housing, and personal well-being. This checklist emphasizes protecting sustainable spending while also planning for changing abilities, relationships, and needs over a potentially 30-year retirement.
Retirement is vastly different than your working and accumulating years. Willful unemployment and decumulation, as the Financial Economists say, is harder than it looks. There are a lot of rules about income, social security, tax breaks, required minimum distributions, Medicare, and the supplemental payment system (IRRMA).
Even if you can manage retirement on your own, could your spouse do the same if you died prematurely or became incapacitated? Working with a fiduciary, fee-only financial advisor can help guide and protect your household throughout retirement.
Finance
1. Have you reduced your portfolio risk yet? A retiree generally wants to alter their portfolio more conservatively and add guardrails beginning around age 50–55 because their financial situation is changing. During most of the working years, the dominant objective is accumulation. As retirement approaches, the objective increasingly becomes protecting the ability to fund a lifetime of spending.
2. How good is your budgeting? Budgeting is essential in retirement. You must start tracking your average monthly spending with reasonable accuracy, then use statistical guidelines to project how spending may change as you age. Tools such as Simplifi can make tracking and forecasting easier.
3. Have you inventoried all assets and cataloged all income streams (pension, annuity, royalties)? They should be clearly written down. If you are younger than 62, you should strongly consider Roth conversions.
4. Can you monitor your retirement tax exposure carefully? You must plan for required minimum distributions beginning at age 75. Today, a $1 million IRA requires an annual RMD withdrawal of roughly $40,000. If your spouse has a similar 401(k) balance and you each receive substantial social security benefits, your combined income would place you in the 24% tax bracket or higher and cause IRMAA surcharges.
5. Are you bad-debt free? Before retirement is the time to eliminate any debt besides mortgage, car and education loans. Do not carry consumer debt into retirement.
6. Will you need a mortgage or HELOC? If you may need a mortgage, HELOC, or reverse mortgage, evaluate your options and apply while you are still employed—before the financing becomes necessary. It becomes much more difficult when you are no longer employed.
7. Can you spend your money? After spending 40 years being rewarded for saving, suddenly being told to deliberately draw down the portfolio can feel deeply uncomfortable. Without the guidance of an advisor, it’s common for households to underspend in retirement.
Health
8. What is your plan for long-term care? Dementia can lead to extraordinary medical costs late in life. Medicaid is always an option, but many want to ensure more resources are in place if needed. Long-term care can be costly, and there is no good insurance for it anymore. You should analyze all options, including self-funding it from your portfolio, relying on family support, or purchasing a hybrid long-term care policy to protect your assets.
9. Do you have a plan for health insurance before Medicare kicks in? Plan how you will maintain health insurance between leaving an employer and becoming eligible for Medicare at 65. COBRA and marketplace plans are often the most straightforward options.
10. How is your health, and will it influence when you take social security? A key retirement decision is whether to claim social security before age 70 or wait. Delaying until 70 provides the largest monthly benefit, but you may need to live to about 84 to break even. Consider your health and life expectancy when deciding.
11. Do you have a realistic view of your health and longevity? A lifespan of 80 versus 95 can substantially change your retirement plan. Plan conservatively in case you live longer than expected but avoid being so cautious that you miss meaningful experiences you can afford while alive.
Estate & Incapacity
12. Am I making my estate easier or harder to administer for my beneficiaries? Serving as an executor is challenging, especially when records are incomplete. Keep your legal and estate documents current, and name primary and contingent beneficiaries on every account, including bank accounts.
13. Have I authorized the right people to handle my money if I can't? Having a clear, legally binding financial power of attorney ensures that your bills get paid and your investments stay managed if you ever face a sudden medical crisis. It needs to be a durable power of attorney signed in the last five years.
14. Am I keeping assets my heirs do not want? High-maintenance property and illiquid investments can create unnecessary work for your family. Unless there is a compelling financial reason to keep them, consider selling collectibles, specialty vehicles, private businesses, tools, and other possessions before your death so others are not left to sell them.
Financial Risk
15. How much can I safely spend during a market downturn? Establish guardrails now that specify how much discretionary spending, including travel and luxury purchases, you will cut if your portfolio falls.
16. How will you guard against preventable financial mistakes? Consider whether emotions influence your investment decisions, whether you are adequately protected from elder fraud and abuse, and how you will reduce the risk of financial errors as you age.
Well-being
17. Where do you want to live in retirement? Consider whether your current home supports aging in place or whether downsizing, moving closer to family, or relocating to a lower-tax state would be more practical.
18. Who is in my daily social circle? Workplace friendships naturally fade after retirement, making it vital to intentionally build or maintain a local community of neighbors, friends, or clubs to combat isolation. Strong and intimate relationships are the strongest factor in long-term human happiness.
19. What are you retiring to, not just from? Leaving work can remove structure and purpose, both essential to well-being. Plan each week to include cognitive stimulation, physical activity, and meaningful social connection in addition to passion projects, volunteer work, and core hobbies.
20. Are you prepared for the later stages of retirement? A 30-year retirement often unfolds in three phases: an active period with greater health and mobility, a middle period of gradual slowing, and a later period—often beginning around age 85—when medical care and daily needs may require much more time. This stage can still be safe and fulfilling, but it often involves a slower pace and reduced independence.