You’ve reached the final stretch of days before retirement, and while your years of financially saving and mentally preparing are about to pay off, a few areas might still need your attention before you ride off into the sunset.
To help prevent your retirement activities from derailing your budget, staying prepared for unexpected emergencies is important. You’ll also want to monitor your productivity and whether your plans for the future feel fulfilling. Even if you’ve been looking forward to retirement for years, you may still find yourself bored after just a few months without something to occupy your time and energy. Without a contingency plan, you may find it difficult to cope.
When you’re less than a month away from retirement, consider paying extra attention to the following ideas.
Staying on budget
Budgeting becomes crucial in retirement because you’re losing income and taking up potentially expensive habits or hobbies such as traveling. According to Morgan H. Smith, CFP® and partner at WorthPointe Money Management, having a good system in place to track—and potentially course correcting—your budget is important.
Without a financial plan, “You’ve got a real possibility of not having enough money to maintain your current lifestyle,” he says. If you’ve made a budgeting plan and practiced it before retirement, the final step is being able to make changes to it as you adjust to your new lifestyle. If you’re having any economic issues, a certified financial planner or other professional may be able to help you and suggest options for living within your new means.
Preparing for the unexpected
Part of managing your budget and retirement plans means being prepared for the unexpected, whether financial, medical, or otherwise. Thirty days before you retire is a good time to review your accounts, estate plans, wills, and other important documents. According to Smith, this means taking an inventory of your assets and ensuring your plans are in place.
At work, this might be a final meeting with a benefits professional in the human resources department to check on what coverage you’ll carry into retirement and what you might lose. You might also do a final check that your financial accounts are ready to be accessed when you need them.
According to Smith, having a family meeting may also be useful as an opportunity to review your plans with your loved ones.
“One of the fears that retirees have is that most people don’t want to be a burden on their children,” he says. By informing your family of your plans and possible needs in retirement, you can help clear up what they may need to do in an emergency.
Adjusting to your new life
Being financially prepared for retirement is a monumental accomplishment, but the emotional transition is an equally important factor you don’t want to forget or ignore.
At this stage, you might want to begin easing into your new life, so that the experience of leaving work isn’t as much of a shock. Even small steps such as emptying out your workspace might help make this change seem more real.
“It’s a matter of the physical separation from the company,” says Karl Leonard Hicks, CFP®, at Leonard Financial Group. Whether it’s cleaning out your desk or talking with your coworkers about your plans, Hicks says putting yourself into the correct state of mind is important to ensure that you don’t wake up on your first day of retirement and feel lost or adrift.
Perhaps the most difficult factor to predict before retirement is how your plans will work out. What happens if your hobbies or clubs don’t make you feel as productive as you thought?
According to Hicks, the best part of being finished with your career is you now have time to follow other interests. If you find yourself wanting to feel more useful or become interested in new hobbies or groups, you shouldn’t be afraid to follow these new pursuits. Even though you’ve spent considerable time making your retirement plans, you don’t have to be hesitant to make changes to them.
“Nothing is written in stone,” Hicks says. If you think you need a change, whether it is to your hobbies or your budget, don’t give in to feeling stuck. Be proactive and seek professional and friendly advice, he says, while embracing the positive changes to your new lifestyle.