A 5-Year Countdown to Retirement

• Estimate—Consider your health and family history to estimate your lifespan and to determine how long your retirement funds need to last.
• Calculate—Add up your monthly retirement income (without windfalls or inheritances) from:
  • Pensions (including any cost-of-living adjustment)
  • Social Security (estimate benefits by going to the Social Security Administration website: www.ssa.gov)
  • Other income—a rental property or part-time job, for instance
  • Assets you’ll sell, such as real estate or a business
  • Income from retirement accounts
  • Annuities, municipal bond dividends and interest

• Budget—Itemize an entire year’s spending to create your retirement budget. Include out-of-pocket medical costs, long-term care, taxes and inflation.
• Pay down—Retire all debt possible, including mortgages, vehicles, credit card balances and other loans.
• Plan—Think about downsizing. If you’re going to stay put for now, research fallback options for the future.
• Insure—Price long-term care insurance and weigh pros and cons. If someone depends on your income, consider purchasing life insurance.
• Consult—Talk to your financial advisor for help on running your numbers on sophisticated planning software, spot planning gaps and refine your investment strategy.

• Catch up—Complete postponed home-maintenance tasks. If possible, get ahead of anticipated repairs and replacements.
• Decide—Contact the Social Security Administration to learn about taking benefits earlier rather than later, and choose when you’ll claim your benefits.
• Study—Learn all you can about converting savings to an income stream; and plan how you’ll withdraw your funds, including how to meet required minimum distributions.
• Supplement—If money will be tight, find a second source of income. For example, take in a boarder or start a business on the side.
• Assess—Decide the bare minimum you need for a comfortable retirement. Can you fill any income gaps or should you adopt a longer horizon?

• Test—Live on your retirement budget to see where it needs adjusting.
• Plan—Write a will and consider establishing a trust. File healthcare directives and appoint a legal power of attorney.
• Disconnect—Tell adult children, lovingly, that they’re on their own financially.
• Regroup—If you can’t afford to retire, then don’t, says Birken. Run your worst-case scenario with a financial planner and work longer, if possible.  Delay collecting Social Security and cut spending to the bone.

• Decide—Contact the Social Security Administration to learn about taking benefits earlier rather than later, and choose when you’ll claim your benefits.
• Roll over—Plan whether and where to roll over workplace savings when you retire.
• Replace—Buy new vehicles to replace older ones.
• Sign up—Research Medicare and supplemental medical plans and enroll in Medicare three months before your 65th birthday.
• Consult—Seek professional help before withdrawing income from your retirement portfolio.

Don’t delay. For help planning for your retirement, contact your financial advisor today.

Source/Disclaimer:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which course of action may be appropriate for you, consult your financial advisor. This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor. LPL Financial representatives offer access to Trust Services through The Private Trust Company N.A., an affiliate of LPL Financial. This material has been prepared by LPL Financial., a registered investment advisor, member FINRA/SIPC. To the extent you are receiving investment advice from a separately registered independent investment advisor, please note that LPL Financial is not an affiliate of and makes no representation with respect to such entity. Not FDIC or NCUA/NCUSIF Insured | No Bank or Credit Union Guarantee | May Lose Value Not Guaranteed by any Government Agency | Not a Bank/Credit Union Deposit © 2014 LPL Financial LLC. All Rights Reserved. The information contained herein has been prepared by and is proprietary to LPL Financial. It may be shared via social media in the exact form provided, in its entirety, with this copyright notice. MKT-0130-0814_B2_AO4 LPL Tracking #1-278931