- The action or fact of leaving one’s job and ceasing to work.
Retirement is something we are all familiar with; a dictionary definition isn’t really needed, is it? Yet, something so ordinary is also something that brings a lot of worries. While the above description can tell you what the word retirement means, the act of it is far more unique to each person that words alone can relate.
Especially in modern times, each person’s retirement will likely look a little different from another’s. Because of these differences, it isn’t very easy to form a retirement plan based on how it works for someone else. Instead, those pondering retirement should use the following tips to assess their financial situation and create a retirement plan unique to their circumstances.
Signs you are prepared:
- You have sustainable health insurance. It is no secret that health insurance remains one of the largest expenses retirees face. If waiting until the age of 65, retirees qualify for Medicare, but if retired before 65, the retiree must pay for health insurance out of pocket. Retiring early is fine, but only if there is a health insurance plan in place.
- Debt is decreased and eliminated. Debt is one of the biggest obstacles when it comes to becoming financially prepared for retirement. It’s one thing to plan for future costs, but maintaining past purchase agreements as well as future debts may be a bit too much for a retirement plan. It is possible to have a good retirement while still paying on a mortgage or car loans; however, having little to no debt allows retirees more freedom with their savings.
- You have a social network. People who don’t plan out social interactions and events after retirement can be surprised to experience a sense of loneliness. Although most people are aware of the extensive amount of time they spend at work through the years, many don’t realize that the primary people they interact with daily are their coworkers. Once retired, those small conversations in passing and lunch trips are diminished significantly if not ceased altogether. Before retiring, it is essential to prepare for the extra free time and lack of social interactions.
- Emergency expenses are planned. Unfortunately, nothing in life is guaranteed, and that includes a complication-free retirement. Those looking to retire should have a plan in place to cover emergency costs before taking the plunge.
*This information is not to be used as professional financial advice. Contact Mark Kemp at Kemp Financial Services for professional insight.