Financial Considerations

• Determine your retirement income and expenses as precisely as possible. You may want to do this before, rather than after, retirement, when your options are more limited. Although you probably won’t be able to significantly impact the amount of your savings in a couple of years, you may decide to postpone retirement or reduce expenses.

• Consider working part-time after retirement. You may want to work to supplement your retirement income or to fill your free time. Review your options before retirement, so you don’t count on an unrealistic amount of income from that job. You may want to check with your current employer for part-time employment opportunities.

• Review your debts and loans, paying off as much as possible.

• Examine your investment portfolio, making necessary adjustments. You may need to reallocate your investments or make arrangements for monthly distributions.

Pension Plan Considerations

• Select your retirement date carefully. Ask your company to calculate benefits based on different retirement dates. You may find that staying for a short period may add substantially to your benefits.

• Review your pension benefit options carefully. Often, your company will offer several distribution options, which may include an annuity and/or a lump-sum distribution. Once made, you usually can’t change your decision.

• Check into health insurance coverage. Determine what health insurance benefits your employer provides, if any, and how much you must pay for those benefits. Even if you qualify for Medicare, you’ll want to investigate Medigap insurance so you’re not unprotected in key areas. Starting January 1, 2006, you can purchase insurance to supplement Medicare subsidized prescription coverage. Review your choices immediately, since you incur a 1% per month permanent increase in premiums for every month you wait past age 65. While you are still employed, you and your spouse should get a complete physical to identify any health problems that may be a concern after retirement.

• If you have pension benefits from previous employers, notify them at least six months before you retire.

Social Security Considerations

• Review your Social Security statement, which is automatically sent approximately three months before your birthday. This statement estimates your retirement benefits at age 62, full retirement age for Social Security purposes, and age 70. Several factors will influence when you start benefits, including your health, work income after retirement, other retirement income sources, and your spouse’s age and health.

• Apply for Social Security benefits at least three months before you retire.

Other Considerations

• Think about how you would like to spend your retirement years. Will you travel, take on new hobbies, start a second career, spend more time on volunteer activities, start a business?

• Decide whether you will continue to live in your current home. You may want to sell your home to help finance your retirement or because you don’t need a home that large.

• If you plan to move to another city, research and visit that city. Make multiple trips for an extended period, preferably during each season, to make sure you really like the new location.

• Evaluate your life insurance. You may want to cash in a policy or convert it to an annuity to supplement your income. Insurance may also be an attractive way to provide for estate taxes.

• Consider long-term-care insurance. As you get older, the cost of this insurance becomes prohibitive, so consider the coverage as soon as possible.

• Now is a good time to review your entire estate plan and make sure your will is updated.

• Analyze your tax situation. Many of the decisions you make for retirement will have an important impact on your tax bill.