5 Steps to Take Before Retiring in Lakewood Ranch

You’re getting close to retirement and have decided you want Lakewood Ranch to be the place you spend your twilight years. Before you put in your notice, however, make sure these 5 things are wrapped up first.

1. Erase Your Debt and Lower Your Expenses

Your nest egg is already getting ravaged by inflation – why make it worse with high credit card interest rates, a mortgage, and a car payment? You will want every penny of your retirement to go to your newfound freedom. Unfortunately, there will be surprising expenses you may not have thought about or that are difficult to plan for. House maintenance fees, HOA fees, utilities, insurance payments, and property taxes will take a toll over the years, – without your usual income to help cover these expenses, your portfolio will seem smaller than it once had. By keeping costs low and not paying interest on loans, you’ll find yourself in a much better position.

2. Figure out Your Health Plan

One of the biggest expenses in retirement is health costs. You should be aware that although Medicare is great, it won’t pay for everything, such as long-term care, many kinds of dental treatments, and even vision. If you’re retiring before qualifying for Medicare, shop for ACA insurance at https://www.healthcare.gov/ to get you through until Medicare kicks in. Be sure to look at Medigap plans that will help pay for deductibles and copays.

3. Formulate a Long-Term Care Plan

Hopefully, you won’t be moving into a nursing home for a long time, if ever. This gives you plenty of time to save up, as they aren’t cheap. But there is a high chance that you will need some form of long-term care. In fact, if you are a woman there’s about a 52% chance of needing some form of long-term care. You probably won’t find an insurance plan that covers long-term care costs either. Start shopping around for a home while you are still in good health and can better understand the implications of each – Lakewood Ranch area alone has 61 of them, so it will take a while. Figure out their costs and determine the best choice for your budget and lifestyle wishes.

4. Fix Your Income

Tied into getting out of debt and lowering your expenses, you want to know exactly what your monthly income will be. Running out of money at an advanced age is one of the greatest fears of each retiree – few want to subsist on social security’s meager monthly checks. Consider withdrawal strategies such as the 4% rule or the 3 bucket strategy to maintain a consistent income that won’t run out. Determine what retirement account you want to withdraw from first, such as a 401(K), an IRA, or Social Security.

5. Reduce Your Taxes

Taxes can quickly eat away from your hard-earned nest egg. The current highest tax bracket is 37%. Of course, we don’t have a crystal ball, but considering taxes are historically low, it’s easy to imagine that they may go up in the future. In fact, we don’t have to imagine hard, because if nothing changes, the Tax Cut and Job Act will expire in 2025, leading to a return to 2016 tax rates. Before retiring, it might make sense to convert any current retirement plans to a Roth account. In any case, your financial advisor will help create a plan to reduce your lifetime tax bill – either through conversions or order of withdrawal strategies.
These are the most concrete financial steps you should take before going into a long, blissful retirement. With your mind at ease, you’ll soon be able to focus on the things that make retirement great, such as creating a strong circle of friends, discovering new hobbies, traveling, and spending time with your loved ones. 
Are you ready to finalize your retirement goals? Reach out today to optimize your retirement plan according to your personal financial situation by clicking the button below.

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Dan DiLascia

Sean Koscho

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