Organizing Your Finances for Retirement

The time has finally come –you’re getting ready to retire. But before you start thinking about life after retirement, it’s important to plan ahead, whether retirement is 30 years from now or 3 months from now. Organizing for retirement will not only help you properly prepare, but also make you more comfortable with your retirement decision. By simplifying your finances, the transition to retirement will be much easier to manage.

Step One: Compile the Data

In retirement, you will begin to pay yourself from the savings accumulated during your working years and in order to do this, it takes an organized approach.

The first step is listing out all of your retirement accounts, such as Social Security and a 401(k), as well as other savings and investment accounts. This will give you a better idea of the funds you have to work with. Listing out your accounts will also help you define whether or not you fully understand what your options are for each account – if not, your employer’s HR department should be able to answer any questions.

Next, determine if there are any accounts you can combine – the less accounts you have to keep track of, the simpler and more organized it will be. For example, do you still have a 401(k) through your former employer and a Simple IRA with your current? See what your options are for combining the two.

Other important items to note are your insurance policies – life insurance, long term care insurance, and your liability insurance. You should also list any debts you may have and major assets such as your home, a vacation home, art, etc. Next, determine who owns the assets and debts, i.e. are they titled in your name or your spouse’s?

Once all of this data is compiled, you will have the information needed to create a net worth statement.

Step Two: Plan Your Expenses

Your next step is determining where your income will be coming from during your retirement years, such as pension income, Social Security, etc. To help with this decision, you should first determine a spending estimate.

A spending estimate can be split between essential living expenses such as housing costs and food, and non-essential living expenses such as vacations and electronics. In addition to the spending estimate, determine what is the timeline for these expenses – do you plan on taking vacations certain times of the year? Are you expected to pay for housing monthly or annually? These factors may be challenging to estimate early on, but they are important tasks to complete in order to feel secure about your finances.

Taking these steps is a lot to do on your own, so having a professional financial advisor guide you through the process will relieve you of much of the stress. In addition, your advisor will help you make the right decisions at a critical time in your life – decisions such as when to begin collecting Social Security; which pension option is best for you and your family; and how best to invest the money to provide income and growth for your retirement years.

Important Disclosure:

The Harvest Group Wealth Management, LLC is an SEC registered investment adviser principally located in Waltham, MA.  Information regarding our firm’s services can be found at A copy of our current written disclosure brochure discussing our advisory services and fees remains available upon request.

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