Imagine a jigsaw puzzle. Lots of interlocking pieces to fit together that require your skill, ability, ingenuity, and patience that, once assembled, creates a picture. Once you have figured out how all the pieces fit together, you feel a sense of accomplishment and you are rewarded by the picture the puzzle creates. You now know how retirement planning works.
Consider the pieces of the retirement planning puzzle.
Daily life How you spend your retirement years should be guided by your passions and how you choose to spend your newly found free time. You may go through phases in retirement and your interests may change. The key is to use your time with activities that give you satisfaction and a sense of purpose.
Options : Part-time work, volunteering, travel, hobbies, time with family.
Where to liveOptions : US or a foreign country, warmer climate, return to the city of your childhood, close to family, different seasonal locations.
Type of living environmentOptions : Your current residence or a downsized residence, condominium or co-op, living with family.
Income and Savings The topic that generates the most interest and anxiety for those contemplating retirement is financial planning. How much income will you need? Will your savings and investments last for the rest of your life? In short, will you have enough?
Sources of income: savings, investment accounts, retirement plan accounts, Social Security, pensions, annuities.
Budget How long your assets will last in retirement is a function of how much money you need to live on. Plan a budget for anticipated financial needs during retirement. Some expenses will be less as your work-life ends, but some expenses may be more such as healthcare costs.
Financial advisor You may have been your own financial advisor up to now. The rules of the game change in retirement, so having professional advice may be prudent. Some investment companies are offering financial advisors at discounted fees. The savings can be considerable.
Estate planning If you have estate planning documents, they should be reviewed as you approach retirement. If you do not have estate planning documents, you need them now more than ever. It is prudent to have competent legal counsel prepare these documents.
Considerations : Distribution of assets as you wish, probate vs. non-probate assets, beneficiary designations, children from prior marriages, special needs of heirs, inheritance and estate taxes, charitable giving
Related documents : Will, living trust, financial power of attorney, advance healthcare directive (living will), medical power of attorney
Medical Insurance In all likelihood your medical insurance needs will change in retirement. You may qualify for Medicare depending on your age at retirement. What are your options for medical insurance and what will the cost be?
Considerations : Coverage options under Medicare, supplemental medical insurance plans, dental insurance.
Health care documents Do you have a health care power of attorney? An advance healthcare directive (living will)?
A piece of the retirement puzzle can be gifts to OUF. There are many ways you can support OUF that coordinate well with your retirement planning.
Happiness should be your ultimate goal in retirement. That means different things to different people. Discover what it means for you, and then do it!