This week, I’m talking about navigating life’s important transitions before and during retirement. 

Today, I’m talking about the retirement transition. Most Americans retire in their 60s, with the most common retirement age being 62. Not surprisingly, this age coincides with the earliest age you can draw social security income. 

Navigating the retirement transition is a big topic that I could take weeks to cover, but today I just want to emphasize a few of the important and irreversible decisions that you’ll need to make at retirement. 

First of all, is the timing of your retirement. When will you retire, and can you afford to retire when you plan to or do you need to consider working longer. 

Related to the retirement timing decision is whether or not you’ll work part-time when you retire. Part-time work is increasingly an option for healthy Americans who have reached retirement age, but maybe can’t afford to fully retire, or don’t want to stop working for other reasons. More and more, I have clients who do consulting work, are still running their business, or are even driving Uber to bring in additional income and fund their retirement lifestyle in the early years of retirement.  

Another key component to the retirement transition is planning and running the numbers to make sure you can actually retire. You’ll also need to decide when to begin tapping into your investment portfolio for income, how much income you’ll need, and whether or not that is realistic and sustainable. Again it’s important to run the numbers on this before you retire, so you don’t have any negative surprises later on and deplete your portfolio after its too late to course-correct. 

In addition, you’ll usually have more travel, or take on some expensive home projects. These expenses are often front-loaded in the early years of retirement and need to be accounted for. 

Then lastly, one of the biggest financial decisions you’ll make is the timing of social security. The difference in lifetime income between taking social security at 62 and full retirement age, or even age 70 can add up to over half a million dollars in lifetime income. So the social security decision is one of the most important and impactful decisions you’ll make in retirement, and defaulting to timing social security with when you retire, may not be the best option. 

That’s it for today. Thanks for listening. My name is Ashley Micciche and this is the One Minute Retirement Tip. 

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