If you plan to retire in 2019 you have several important decisions to make. This week I’m focusing on the 5 most important things you’ll want to button up in the last few months before you transition into retirement.

Yesterday, I talked about the 3nd thing you’ll want to do if you’re retiring this year, which is to decide when to start social security benefits, and why it might make sense to wait until after you retire to start your social security benefits.

Today, I’m talking about checklist item #4. It’s what I believe is the most important thing you’ll need to do before you retire, and that is to answer the question: Will you run out of money in retirement?

The only way you’ll be able to answer this question confidently is by doing a detailed retirement analysis with a competent financial advisor. Ideally, you’ll want to work with an advisor who has some advanced training in this area, like a Chartered Retirement Planning Counselor or a Certified Financial Planner.

Often, you can have a financial plan done for you for a flat fee, or if you’re already working with a financial advisor and you haven’t done this, it might not cost you any additional outlay to do a retirement analysis.

Here’s what the analysis will do for you. It will take inventory of where you are today - your assets, your target retirement date, and your income needs in retirement. It will assess your spending goals, like travel, remodeling your home, or paying for your daughter’s wedding, incorporate healthcare costs, taxes, inflation, and look at your current investment portfolio to answer a very important question:

Will you run out of money in retirement?

The software we use will live your retirement 1000 different ways in good and bad times to see what the chance is of you outliving your money and having to move in with your kids when you’re 80 years old.

You only want to make the transition into retirement if your chance of success is high - ideally, above 80%. Anything less than that and you’ll need to rethink your retirement date, your goals, or make some adjustments to your spending in retirement...or maybe you just need to drive Uber for a couple years to generate some extra income once you retire.

Either way, this is the best use of time and money you can spend in the last year or even 5 years before retirement. The sooner you complete a retirement analysis, the longer you have to make adjustments if the results aren’t good.

That’s it for today. Thanks for listening.

Tomorrow we’re going to talk about the unexpected and often overlooked thing you’ll want to do before you retire.

My name is Ashley Micciche and this is the One Minute Retirement Tip.

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