There’s an insightful quote that says:  Retirement is like a long vacation in Las Vegas.  The goal is to enjoy it the fullest, but not so fully that you run out of money.

The challenge, obviously, is how do you enjoy retirement with the confidence that you won’t run out of money?  The answer is to create a plan and then review and revise your plan as necessary as you approach retirement.

I suggest you start by determining your overall retirement vision.  Of course most people envision a retirement that provides financial security, but what about other visions such as spending more time with family, traveling, buying a second home, volunteering or leaving a lasting legacy.  The deeper you delve and the clearer your vision, the easier and more effective the planning process will be.

You may also find it helpful to identify your retirement to-do list.  Some call it a bucket list or a dream list.  Whatever it is, this list can be a great foundation for setting your future retirement goals.  Try brainstorming different activities and asking yourself what activities do you enjoy now, what activities have you enjoyed in the past but are no longer doing, and what new activities have you always wanted to do but have not had the time to do.

The point of a retirement vision and a bucket list is to get to your underlying value system and to clearly define what’s really important to you in life.  When you do this, you’ll be better able to plan and establish your appropriate goals.

So now you have your vision, your to-do list and your goals.  Next, you need to chart the short and long-term paths that will get you to your retirement goals.  This means determining where you are right now, where you want to be and how you will get there.  You also need to adequately assess:

  • how many years you have to save before retirement
  • the number of years you may be in retirement, and
  • the after-tax income you’ll need to live your desired lifestyle during those retirement years.

And, you’ll need to review if you are currently saving enough to meet those goals utilizing:

  • A qualified retirement plan (401k, 403b, SEP, Simple, etc.)
  • A non-qualified retirement plan (Deferred Compensation Plan, etc.)
  • Some other tax advantage investment vehicle

It’s also important to review the current asset allocation of any existing investments you may have to verify that they are appropriate for your age, goals and level of risk tolerance, as well as review which income sources are available (Social Security, pension, 401(k), investment earnings, home equity, etc.) to fund your retirement?

Retirement planning is an ongoing, lifelong process that takes decades of commitment in order to receive the final payoff.  Even if you’re just a few years away from retirement, there’s still time to create a more secure retirement for yourself.

Fahmy & Associates is here to help.  Book your FREE RETIREMENT PLANNING CONSULTATION now by calling 703-760-4630.

— Ken Fahmy