Happy senior couple using digital tablet in kitchen at home

Nine-Point Retirement Checklist

What should I be thinking about when nearing/considering retirement?  It’s one of the most common questions we’re asked and it’s critical to review your personal finances and plan how to spend money after you retire.

Retirement means different things to different people. To some, it could mean having additional time to visit family. To others it might present more opportunities to volunteer in the community. And to some it might even mean having the chance to get a little more golf or tennis in with close friends.

But while some of these things can be very low or even no cost (think hiking or reading in the shade), many of them will still require money.


Scarborough Capital Management has been helping busy families retire for more than 30 years. Contact us to see how we can help you too.


If you're getting to the point where the idea of retirement is becoming more of a reality, but you haven't yet considered its financial impact, here are nine tips to help ensure that you can make the most of life's next chapter.

Take stock. All this step requires is that you examine your assets and liabilities. In other words, did you leave a 401(k) at an old job? Have you checked your main stock portfolio lately? Do you have a number of outstanding loans? Do you have too much cash saved in a low-interest savings account, or even worse, a basic checking account?

Once you can get a handle on what you have and where you have it, record everything in a simple spreadsheet or in a notebook. Once you do, you can move on to step two.

Evaluate expenses. The financial world has lots of plans for people to save for retirement, but very few people talk about how to spend during retirement. This fact alone can get the best saver off track very quickly.

For example, if someone said to you that you'd have $1 million in the bank for retirement, you may say, "hey, that's great!" But in reality, that sum might only equate to about $40,000 to $50,000 per year of income. Would this be enough for you and your spouse for the rest of your lives?

For this step, first, figure out all of your current expenses – and yes, we mean all of them. Even those "inexpensive" stops to the coffee shop can add up. Again, this can be as simple as making a list and totaling it up.

Next, figure out what expenses you will still have after retirement, those that you may be able to cut, and even those that may come up.

For example, you may have a car payment, and that won't change. But what about your mortgage payment? Could that be adjusted if you downsized? Relocating could reduce not only the cost of the mortgage, but also property taxes, utilities, and maybe even travel expenses if you move closer to places you visit frequently.

In terms of what could arise, some people have the dream of wanting to own a beach or mountain home as a vacation spot, or even simply taking more vacations. These costs will add up fast, so be sure to give your best estimate.

And if you think this step doesn't matter, please reconsider that thought. Just a few years of outpacing your budget at the beginning of retirement could mean trouble later.

Formulate a plan. This is the most involved part of planning for retirement and where you should consider reaching out for help.  At Scarborough Capital Management we’ll help provide some visibility on your retirement picture and can develop side-by-side scenarios of what retirement might look like under various circumstances.

If you've created a budget and have an idea of what you've already set aside and what you'll be spending, you have the basis to build your plan. With that, we'll really be looking at two things – money you currently have, and money you may still need to make.

What to do with cash. Volatility in the stock market has often caused retirees stress, as they have fewer years to recoup any losses they suffer as a result of a market dip. While it might be a good idea to keep 40 percent to 50 percent of your assets in some type of bonds or cash in retirement, we believe taking all of your money out of the stock market or other interest bearing vehicles isn't a good idea.

The reason is that without any capital gaining interest, any money that's just stored "in a mattress" for instance can't keep pace with inflation. This "longevity risk" could be more risky than having a solid, diversified portfolio.

Timing of investment account withdrawals. How much you withdraw early on and how the market performs can be some of the most important factors in your retirement picture. In this case, the guidance of a professional may be key in helping you avoid some serious mistakes.

Timing of income, such as employer pensions or deferred compensation plans. Depending on your circumstances, you may have some flexibility in when you commence your pension or deferred compensation benefits. In other cases, there may be pre-defined dates and timelines for income.

Further, many large employers are also offering lump-sum pension payout options versus a monthly check over time. Be sure to evaluate these decisions as part of your broader plan. 

Timing of Social Security benefits. The Social Security system has more claiming scenarios than you may think. The commencement of benefits (or delaying them) is a decision that should not be made lightly. There is no "one size fits all" advice in this arena, so it's important to examine your options to see how they fit your situation.

"Pecking order" of accounts. Various types of accounts – like a Roth IRA or tax-deferred annuity or checking account – have various tax treatments. Understanding the characteristics of all your assets – in conjunction with your goals, timeframes and legacy wishes – will help you determine a tax-efficient strategy to draw on your assets during retirement. 

Review protections. You may be paying for insurance you don't need (for instance, an old life insurance policy that has adequate cash-value to maintain itself); in other cases it might be beneficial to add coverage you don't currently have (such as an umbrella policy or long-term care insurance).

You may find though that after going through the budgeting process that you have a gap between what you have and what you are planning on spending. If you're going to maintain your spending plan you'll need a small income stream during this period of your life.

In fact, this exact scenario has caused a number of retirees to go back into the job market. This doesn't have to be a bad thing either. Some of these individuals have earned some extra income by looking for employment at places they find enjoyable or meaningful, such as a garden store, library, or even community center. 

In other words, it doesn't have to be viewed as work if you find enjoyment or meaning from it, and if you're setting your own schedule.

As a final note, sometimes it may seem like planning for retirement can be too daunting of a task to take on, but it doesn't have to be.  

While these steps are not meant to be exhaustive, they are designed to help retirees see that with some preparation and professional assistance, you can help put your mind at ease and enjoy everything that you worked so hard to achieve.  Call us; we’d love to help you.

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