Things To Do Before Retirement
You will want to plan for your retirement. Below are some things you will want to do to determine and plan for your retirement date.
- Become familiar with your investments. Talk to a TIAA-CREF and/or Fidelity representative about your retirement options. It is risky to depend heavily on other people’s advice, even colleagues who seem knowledgeable. Their situation may be different from yours and there are constant changes in tax laws and plan options, which could affect you differently.
- Organize your personal financial data. Select one or two potential target ages or dates for retirement and determine related financial goals.
- Request an updated Earnings and Benefit Statement. Contact the Social Security Administration by telephone or via the Internet. Complete the form and mail it to the specified address.
- Request pre-retirement illustrations from TIAA-CREF for your target ages or dates. Consider anticipated allocation changes, and expectations about future salary increases or decreases. You may request multiple illustrations for different target ages or dates and other circumstances. Update illustrations annually as changes occur in earnings, performance, payout rates, or other factors.
- Gather data from all your other assets, such as other pension plans, investments, insurance policies, etc. Determine the level of monthly benefits from any other sources you have.
- Calculate how much your other savings will be worth at your target retirement age, assuming a conservative rate for investment earnings. Then, over a 20 to 30 year retirement period, calculate the amount of additional annual retirement income your other savings will provide.
Your Goals, Priorities, and Philosophies
- What are your primary retirement concerns?
- What are your needs for retirement income versus your desire to leave funds for heirs?
- How will you balance your need for liquidity (cash) versus your desire for lifetime protection?
- Do you have adequate funds accessible for emergencies or unexpected needs in the later years of your retirement?
- Have you adequately prepared for inflation? How?
- Are you leaning towards a lifetime annuity or non-annuity alternatives, or a combination of both?
- Have you considered your health and longevity expectation?
- Can you afford to delay making any permanent decisions about your investments? Does a temporary or transitional option sound attractive?
- Would you benefit from greater diversification, or a change in the overall level of investment risk you are taking? Have you balanced your desire for safety with investments that may provide protection from inflation? How does this fit into your overall investment portfolio?