Retirement Planning Checklist
5 Essential Elements

It's never too early to start planning for retirement.

This retirement planning checklist will give you a reality check and help you prepare, no matter what age you plan to retire.

As millions of Baby Boomers pour into the ranks of the retired, many may look back on their preparations and wish that they had done some things differently in their retirement planning.

Laying your retirement groundwork early may help you avoid being ill-prepared at crucial time when a smooth transition is what everyone needs.

Retirement planning is a lifelong process involving several stages and many steps, but there are five essential elements you need for a retirement planning checklist: 

The Retirement Planning Checklist

Define Lifestyle Needs

Even if you have already taken the time to establish your retirement goals and envision your life after employment, you should revisit your plans periodically as your financial situation changes and your perspective on life becomes more acute.

The realities of retirement living and people’s outlook on their financial future constantly evolve and this can influence the way we envision retirement.

Your dreams of world travel may have shifted to a desire to start a business.

Retiring to the country may have seemed like a nice idea, but perhaps a retirement community is a more practical destination now.

Determine the Costs of Your Retirement

Your retirement lifestyle choice comes with a price tag. Generally, retirement living should cost less as many of your expenses should fall off.

Instead of following some general guideline as to how much you will need, take the time to create an actual budget that will reflect your actual needs at the time of retirement.

Then factor in inflation for the number of years before you reach retirement and then out to your life expectancy.

Assess Where You Are Today

Keep a constant accounting of your financial situation so you know exactly where you are in relation to where you want to be.

Your net worth (assets less debt) is your report card that tells you how you are doing in meeting your retirement goals.

This needs to be done annually.

If you have any gaps in your plan, you can make the necessary adjustments to increase your savings rate or adjust your asset allocation to get back on track.

The more frequent reviews of your net worth, the smaller the adjustments you will need.

Review all of Your Retirement Benefit Plans

It is never too early to review your government pension program to know what your options are and what to expect under different scenarios.

You can request an accounting of your plan benefits at any time.

Do the same if you have an employer pension and be aware of any changes to the plan that could affect your benefits.

This should be done annually in the last five years of your employment.

Manage both Risks and Returns

Your investment strategy should reflect both your need to generate adequate returns and your ability to tolerate risk.

When investing for retirement, one should be as concerned with inflation risk as they are with market risk and not invest too conservatively.

The longer your retirement timeline, the more risk you can afford to assume in order to achieve the returns that are necessary to build a sufficient retirement fund.

As your timeline shortens, your allocation should shift to more conservative investments.

You should review your investment allocation annually.


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