Enjoying Your retirement

1. Test your plan before you set a retirement date.

The last few years of your career are usually the most lucrative. Before you commit to a specific retirement date, make sure you understand the impact of retiring versus spending a few more years on the job. Do some analysis, or work with a professional advisor, to ensure your lifestyle goals can be supported for the remainder of your life with your existing savings and projected retirement income.

2. Delay Taking Social Security

It may be tempting to take social security at full retirement age, or earlier, but there are very good reasons to delay. Every year you delay past full retirement age, up to age 70, gives you an 8% increase in your annual benefit. That's an 8% increase in guaranteed lifetime income every year! Given the increasing lifespan of retirees, it is very likely that you will receive much more in total if you wait for the maximum benefit. Plus, your personal "income safety net” will be much more comfortable, in the unlikely event that your investment portfolio is exhausted before death.

3. Review your estate plan.

This is an opportunity to do a final review of your wills, trusts and life insurance policies. It's important to make sure that your financial goals can be met with your current assets.

I can help you review your existing plan, or help you create one.

4. Consolidate Accounts

If you have investment accounts with several institutions, you can consolidate to simplify and gain better control over asset allocation.

5. Beware identity theft

Sadly, identity thieves often target people who are older and appear to have significant assets. Keep passwords fresh, limit the number of institutions with your personal information, and never send account numbers or Social Security numbers through email. Also be wary of requests from your financial institutions for your personal information. These can be fake requests from identity thieves. If possible, work with one person so you can recognize their voice on the phone.

6. Identify your "Lead Advisor"

Ask one professional to be the leading advisor who will coordinate with the other professionals who help you. Lawyers, accountants, insurance agents, realtors, and financial advisors often have overlapping roles that can be complicated by a lack of communication. I find that working as a leading advisor puts me in an excellent position to improve everyone's efficiency and find opportunities for improvement in my clients' retirement strategies. As you reach old age, it is especially helpful to have one familiar and trustworthy person coordinate all your services.

7. Continue to take investment risk

The end of your career may seem like the natural time to cash out your stock investments, but don't! You could still have three more decades to live. If you aren't investing moderately and intelligently in the stock market, it's likely that your purchasing power will diminish significantly over that period. Keeping an appropriate portion of your portfolio invested in global diversified stocks is critical to fight long-term inflation. As you get older, more conservative assets can play a bigger role. However, even traditionally conservative investments such as intermediate term bonds still carry risks, so it's important to remember that investing in retirement will have both ups and downs. Stick to the plan, work with the right people, and don't think about money too much.

8. Spend on "experiences" more than "things".

Several studies have shown that people derive the most satisfaction from their money by making memories and sharing time with loved ones. Use your money to travel, enjoy good food, and share experiences with your friends and family. Remember: every moment is precious, nobody is perfect, there is no time like the present, and there's more to life than money!


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Middleton Advisory LLC is a Maryland Registered Investment Advisor. No part of this page is meant as tax or legal advice.
Investments which are not FDIC insured involve the risk of losing principle.