Retirement Planning: How to Do It and When to Start to Ensure You Retire on Your Terms

When is the best time to start planning for retirement?

Right now!

Whether you’re new to the workforce or just starting to see retirement on the horizon, you never know what tomorrow is going to bring. Hopefully you’re able to work as long as you want, doing something that’s fulfilling until you’re ready to retire.

I’ve worked with so many folks who’ve had retirement forced upon them by an illness or accident, a sudden shift in family dynamics, or an unexpected job loss. The folks who were able to cope with those less-than-ideal transitions had a solid financial plan under their feet that we could adjust as necessary.

And the ones who didn’t have a plan? They really struggled, both financially and emotionally.

Here are 4 things you can do right now to help ensure you retire on your terms, not somebody else’s.

1. Design Your Retirement Blueprint.

New Keen Wealth clients are often surprised when our first meeting doesn’t start with balances, spreadsheets, and projections. Instead, our first step is to understand what kind of retirement each client wants. We’ll ask questions like:

• Do you want to keep working as long as possible? Retire early?
• What do you want a typical day to look like?
• What hobbies or passions do you want to pursue?
• Where do you want to live?
• Where do you want to travel?
• With whom do you want to spend your time?
• How do you see your life five years into retirement? 10 years? 20?
• What did you learn about money growing up?

Every other part of your financial plan should be geared towards these goals.

If you’re just starting to think about retirement, my book, Keen on Retirement – Engineering the Second Half of Your Life, includes a Blueprinting Exercise that you and your spouse can use to discuss these and other important lifestyle issues. This exercise will help you see the retirement you want so that you can work with a fiduciary advisor to reverse-engineer the steps that will get you there.

2. Create an Inventory of Assets.

A simple balance sheet will help you, your spouse, and your fiduciary advisor get the ball rolling on the nuts and bolts of your plan.

Some key items include:

• Annual income
• Real estate
• Personal valuables (vehicles, jewelry, etc.)
• Bank accounts
• Investment accounts
• Retirement plans (401(k), ESOP, IRA, pension, etc.)
• Business interests (ownership, equipment, etc.)
• Benefits payable upon death (life insurance, Social Security, etc.)

On the other side of the sheet, we’ll want to see liabilities, including:

• Credit card debt
• Mortgage
• Vehicle loans
• Personal loans

I also ask my clients to add a section for non-monetary assets and liabilities, including:

• Personal and professional reputation
• Network of friends or colleagues
• Level of community engagement
• Health

Many financial plans don’t take these things into account. But the strength of your personal networks is going to have a big influence on how fulfilling your retirement is. And if you or your spouse have any serious health issues, that’s a liability we need to mitigate with careful Medicare planning.

3. Outline Your Estate Plan.

When it comes to retirement procrastination, estate plans are usually kicked as far down the curb as possible.

I understand that it’s not pleasant to think about dying. But if something unexpected should happen to you or your spouse, you need to make sure you have legally binding documents in place so that your estate is executed the way you want. Otherwise, your state of residence is going to distribute your assets according to local law. That process is often public and occasionally quite messy.

Start by talking to your spouse about who your beneficiaries should be, particularly the person you want to put in charge of settling your estate.

Next, discuss how you want your assets distributed. For many folks, this boils down to “who gets what.” But you also might have causes you’d like to support by establishing a charitable foundation.

Finally, talk about how each of you want to be cared for at the end of your lives, or in the event that you are incapacitated.

You’ll need to work with your fiduciary advisor and an estate planning attorney to organize your answers into these essential estate planning documents:

• Your Last Will and Testament, which outlines your last wishes and explains how you want your estate to be distributed to your heirs and any other beneficiaries, such as charitable organizations.
• Power of Attorney that authorizes someone you trust to act on your behalf while you’re still alive, in the event that you are incapacitated or unable to make decisions.
• Your Healthcare Directive dictating how you would like to be cared for in the event that you become incapacitated.
• A Living Will designating a person to be in charge of making important medical choices on your behalf if you are unable to.

4. Call in the Pros.

Your Blueprint, Inventory of Assets, and Estate Plan should give you and your spouse a pretty good outline of what you want your financial future to look like.

Now it’s time to chart your dream flight into retirement.

One benefit of working with my team at Keen Wealth is that we can quarterback all the moving parts that go into creating a comprehensive plan. We have tools that can help you and your spouse clarify any details that are still a little hazy. We can introduce you to reputable estate attorneys and CPAs and coordinate our work with theirs. We’ll double check any Medicare questions you have with health care professionals.

And, most importantly, we’ll revisit all of these important issues annually via our checklist-driven process. As your life changes, we’ll adjust your plan along with it.

But don’t wait! You can start planning your retirement today with just your spouse and an hour or two of conversation.

And when you’re done talking, make an appointment to visit Keen Wealth.

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About Bill

Bill Keen is a CHARTERED RETIREMENT PLANNING COUNSELOR℠ and independent financial advisor with more than 25 years of industry experience. As the founder and CEO of Keen Wealth Advisors, a registered investment advisory firm, he specializes in providing personalized retirement planning designed to help people thrive before and during their retirement years. With a passion for educating others, Bill regularly blogs about retirement planning, hosts the podcast Keen on Retirement, and has contributed to U.S. News and World Report, Reuters, Wall Street Journal’s Market Watch, Yahoo Finance, and other publications. Based in Overland Park, Kansas, Bill and his team work with clients throughout the greater Kansas City area and across the nation. To learn more, connect with him on LinkedIn or visit www.keenwealthadvisors.com.

KWMG, LLC’s dba Keen Wealth Advisors (“company”) is an SEC Registered Investment Advisor located in Overland Park, KS. The company and its representatives may only conduct business in those states where registered or where excluded/exempt or from licensure. For registration information please contact the SEC or the state securities regulators for the states where the company is notice filed. A copy of the company ADV is available upon request. Advisory services are only offered to clients or prospective clients where the company and its representatives are properly licensed or exempt from licensure. No advice may be rendered by the company unless a client service agreement is in place. This information is not intended to be investment advice or construed as a recommendation or endorsement of any particular investment or investment strategy and is for illustrative purposes only. Clients and prospective clients must consider all relevant risk factors involved with each strategy, including costs or fees, and their own personal financial situations before trading.

The views outlined in the book, Keen on Retirement Engineering the Second Half of Your Life, are those of the author and should not be construed as individualized or personalized investment advice. Any economic and/or performance information cited is historical and not indicative of future results. Economic forecasts set forth may not develop as predicted.

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