Visualize Retirement

Visualize Retirement: Retirement Planning Checklist

We often focus on planning for the financial side of retirement to ensure that our savings and investments will meet our retirement needs. But there is a lot more to retirement than financial. Your goals, circumstances, and priorities will change as you plan for and transition to retirement. That’s why it’s important to have a checklist and resources that keep you on track as you move through these changes.

Create your vision for retirement

How do you know how much to save for retirement if you don’t know what you’re saving for? By creating your vision—the Who, What, Where, When and Why of your retirement—you gain clarity about your retirement and what may be involved in achieving it. Some of the things to consider include:

  • Your target retirement age. Although it’s difficult to anticipate the right time to retire or what unexpected situations may arise, set a goal of when you would like to retire.
  • Where you want to live. Are you staying put in retirement or considering a move? As you develop your vision, consider whether you want to stay in your home, downsize, and/or relocate.
  • What role, if any, work will play in your retirement. Work has become a larger part of people’s retirement lifestyle, either for financial reasons or for the nonfinancial benefits people receive from work, such as a sense of purpose and social engagement. Think through whether you envision work playing a minor or significant role in your retirement, or none at all.

Age-Related Milestone: 62-70

You’ll receive the maximum monthly benefit at age 70, with a reduction for each month taken before age 70. You can actually start taking benefits, in most cases, at age 62, but this would result in a lower monthly benefit amount.

Build a personalized action plan to bring clarity to your vision

After creating your vision, you’ll uncover ideas and questions about what you have planned. Identifying things you want to learn, practice, and communicate to others will help answer your questions and enable you to refine your vision as your retirement nears. Some of the things to consider include:

  • Coordinate your vision with your spouse/partner. Don’t assume you have the same plan in mind if you haven’t explicitly discussed it yet. You may also want to involve your children and other family members since your plans can have an impact on their future as well as yours.
  • Talk about your potential health care needs in retirement. Identify the future care you may need based on your current health and family health history, and talk with family and friends you want on your caregiving and wellness support team about any potential long-term care arrangements, health care directives, and powers of attorney—especially if you’re expecting them to play a role. These can be difficult conversations so planning ahead and understanding roles and responsibilities is important so everyone knows what is expected.

Start connecting the nonfinancials to the financials

Doing what you can to consider the nonfinancials—many of which have a direct financial impact—will help as you work toward making your vision a reality.

  • Assess your potential spending needs in retirement. Creating your vision can help you understand your potential spending needs in retirement. Work with your financial professional to determine if your retirement saving strategy is sufficient to support your vision—giving yourself time to make changes to your saving strategy or adjust/reevaluate your vision before you retire.
  • Understand your retirement income preferences. It’s helpful to understand what features of retirement income are important to you—e.g., the amount of income that is needed or the variability of your income from month to month—and what tradeoffs you’re willing to make—e.g., generally the more fixed and stable an income source is, the less likely it will have potential growth to keep up with inflation. Again, work with your financial professional to discuss your preferences and to determine the potential solutions to consider for your retirement portfolio.
  • Educate yourself on Social Security benefits. It’s important to understand the different approaches for claiming Social Security benefits including coordinating your claiming strategy with your spouse. For example, to maximize the benefit for a surviving spouse, the higher earner could wait until age 70 before claiming benefits. You can get more information on Social Security at ssa.gov.
  • Learn your options on Medicare. Medicare is the primary health program for retirees so it’s important to understand and carefully evaluate your options to determine which plans are best suited for your situation. You can get more information about the options, including premium costs and out-of-pocket expenses, on Medicare.gov. You may need to explore alternative health care coverage options, including the purchase of coverage through your state’s health care exchange, if you plan on retiring before age 65.
  • Understand your sources of retirement income. Consult with your financial professional to map out all of your sources of income in retirement. They can work with you on a financial plan and investment strategy to help make your retirement vision a reality.

Age-Related Milestone: 62-70

You’ll receive the maximum monthly benefit at age 70, with a reduction for each month taken before age 70. You can actually start taking benefits, in most cases, at age 62, but this would result in a lower monthly benefit amount.

Age-Related Milestone: 65 or before

You generally become Medicare-eligible at age 65 but should enroll either three months before or up to three months after the month in which you turn age 65. Delaying enrollment may result in penalties.

Age-Related Milestone: 1-2 years before retirement

Are you planning to work in retirement? If so, that’s an additional income source that can complement the income received from your investments, savings, and Social Security.

Work with your financial professional to connect the nonfinancial to the financial solutions that can help make your retirement vision a reality.

T. Rowe Price Investment Services, Inc.

This material is provided for general and educational purposes only, and not intended to provide legal, tax or investment advice. This material does not provide recommendations concerning investments, investment strategies or account types; and not intended to suggest any particular investment action is appropriate for you. Please consider your own circumstances before making an investment decision.

© 2021 T. Rowe Price. All rights reserved. T. ROWE PRICE, INVEST WITH CONFIDENCE, and the bighorn sheep design are, collectively and/or apart, trademarks or registered trademarks of T. Rowe Price Group, Inc.

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