Because everyone’s financial situation and long-term goals are unique, there’s no one-size-fits-all approach to retirement planning. There are, however, a few tips that everyone should follow when making arrangements for leaving the workforce. To ensure you’re ready for retirement when the time comes, follow these guidelines. 

Do:

Focus on paying down debt. 

The less debt you have upon retiring, the lower your monthly financial obligations will be and the longer your savings will last. As such, you should strive to pay off car notes, credit card balances, mortgages, and medical debts in the years leading up to retirement. 

Plan for all eventualities. 

Because of life’s unpredictability, there’s no way to be sure just how much you’ll need to save for retirement. With help from a certified public accountant, however, you can arrive at a fairly reasonable estimate to work toward.

In addition to considering all fixed expenses, like housing and health insurance, a knowledgeable CPA will ensure you’re expecting the unexpected. For example, it may be wise to purchase long-term care insurance, which will cover nursing home care should you need it. 

Don’t:

Postpone saving money. 

It’s never too early to start saving for retirement. Even those who are relatively young and are focusing on more imminent goals, like buying a home, can benefit from putting aside a small portion of each paycheck. The sooner you start planning ahead, the easier it will be to reach each savings milestone, and the more comfortable your retirement will be.

Rely solely on distributions from others. 

While it’s okay to account for pension plans and government benefits when planning for retirement, you shouldn’t expect third parties to cover all your living expenses upon leaving the workforce. Even the most reliable programs aren’t guaranteed to last the duration of your retirement. Having at least some savings to supplement the benefits you’re entitled to will ensure your financial security, no matter what happens. 

If you want to develop financial strategies that allow you to leave the workforce with confidence, contact Joe Heard, CPA, in Checotah, OK. He provides comprehensive retirement planning services for people at all stages of their careers. He also assists with tax return preparation and business consulting. To schedule an appointment, reach out on his website or call (918) 473-1492.