Old 09-08-12, 11:48 PM
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rnorris
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People have different viewpoints as to what financial measures to take, but here are some undisputed things to do leading up to retirement:
No credit card debt. Period.
Health care is taken care of (insurance, money set aside if self-insuring etc)
You know what your monthly/yearly expenses are. It's crazy to retire early unless you know the specific expenses you pay every year. Having a "general idea" isn't close to good enough, unless you're so wealthy it doesn't matter.
You know what your NET retirement income is. Presuming this number is less than your expenses, from where will you draw funds to make up the shortfall?
You'll need a contingency fund for large expenses - major home repair, replacement car, etc.

Some people believe you should carry a mortgage, but I strongly disagree.

I suggest you check out www.bogleheads.org/ and www.early-retirement.org
Excellent advice here. Looking at the bigger picture, you need to have a pretty good concept of what you want your retirement to be like before you can make plans and estimate your expenses. Questions like these need to be considered:

-Do you want to stay in your current location, or move to another one?
-Are there any current or possible future dependents (children, parents, etc.) that you will have to be responsible for in retirement?
-What sort of lifestyle would you like to have? Could you afford it, or do you need to revise it to meet financial realities?
-Does your spouse or partner agree to your concept of retirement? If not, what compromises are each of you willing to make?

Lessons from my own retirement:

-If you're fortunate to be working for a large employer that offers retirement counseling for employees, use it!

-Don't try to relocate too soon after your retirement date. I left myself all of a week and regretted it- there wasn't enough time to say goodbye gracefully to co-workers and friends who wanted visits for one last dinner, etc.

-Don't imagine things will be peaceful end of work- I thought I'd be sort of coasting by then, but the reality was my last few weeks were hell with trying to get everything finished up. I was actually off the payroll by the time I could clean out my office. My employer was Ok with that, but some might not be.

In any case, you're about to embark upon quite an adventure- with careful planning and a clear set of objectives for your retirement it can be a really positive life change.

Best of luck!

Last edited by rnorris; 09-09-12 at 12:14 AM.
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