Planning for retirement is actually pretty simple. Just answer the question in the headline above with a resounding “Yes!” and you’re good to go. The problem is most people can’t do that. There’s always that little question mark at the end. It should really be called the “uncertain mark,” don’t you think?
Answering this question is actually very difficult. It requires asking about new obstacles you didn’t face while working, such as: Did I save enough money? Will I run out of money? When do I start Social Security? Which Medicare plans are best? How would I pay for long-term care? Should I pay off the mortgage? How do I take required minimum distributions (RMDs)? Should I take my pension in payments or a lump sum?
The list goes on and on.
So, how do you know for certain that you’ll be OK in retirement? I think I can help. I’ve scoured over 70 years of retirement research, identified risks in retirement and categorized them into five key areas to focus on. I call it our Smiling Through Retirement Process©.
1. Protect what you’ve saved.
Being retired means you aren’t saving anymore. You’re spending. And when you spend and lose money, bad things happen. For example, if you saved $1 million and need $50,000 a year in income, that’s 5%. If you lose 50%, you now have $500,000, but still need $50,000 a year. That’s not 5% anymore. It’s 10%. That’s too much, and you’ll most likely run out of money.
Safety with reasonable returns wins every time.
Sponsored Content
2. Have an income plan.
You need to know that you will never run out of money. To do that, you must have a detailed, all-inclusive income plan. It needs to provide certainty that you will never run out of money, no matter how long you live.
Sponsored Content
3. Work out health care options, including Medicare and long-term care.
Get your Medicare right, and you’re golden. Get it wrong, and you’ll forever pay too much and may not get the level of care you need.
Americans who turned 65 in 2021 have an 83% chance of needing some type of long-term care before they pass away. Not covering this risk is the fastest way to tank your retirement goals. There are several ways to cover this risk, not just one. And it can be covered at low or no cost.
If you don’t use it, you don’t lose it. And if you can’t medically qualify, there’s a way to cover this risk, too.
Sponsored Content
4. Reduce taxes you owe.
Paying too much in taxes in retirement is enemy No. 1. Who owns your 401(k) or IRA account? Did you say you do? Not quite. Meet your partners, the IRS and your state government (if you pay state income taxes where you live). Additionally, if taxes go up, they own more, and you own less.
Speaking of your-tax deferred money, do you think you’ll be in a lower income tax bracket come retirement? Again, not quite. When you pull that money out (which you are forced to do with required minimum distributions), you will be in the same or higher tax bracket than your working years.
But there’s good news. You can fix this problem. Fixing it means you will pay less taxes in retirement, have more money to spend and leave more money to your kids, mostly tax-free!
Sponsored Content
5. Put together an estate plan.
Everybody needs an estate plan, whether or not you have lots of assets. An estate plan controls things that happen if you become disabled or die.
If your disability is long term — and you don’t have an estate plan, or you have an improperly designed estate plan — the person you name to take care of your money can use your money only for you. So, if it’s your spouse, they cannot use your money for themselves, your kids or anything else. If they do, they can be removed and replaced with an attorney. Your family would pay big, unnecessary legal fees.
If you don’t have an estate plan, or it’s improperly designed, your money can end up in the wrong people’s hands. For example, if your kid gets divorced, half of the money you left for them and your grandkids will most likely go to their ex-spouse. Or, if your kid is at fault in a serious car accident and is sued, all your money could go to the victim’s family.
These terrible situations, and many others, can be avoided with a properly designed and implemented estate plan.
If you address each of the above areas going into retirement, you have done everything possible to ensure you’ll be OK for the rest of your life. Seeking guidance from a qualified financial professional and estate attorney is a great place to start.
Here’s to you living a Happily Ever After Retirement©!
RELATED CONTENT
Five Tax Moves Retirees Should Consider Before Dec. 31
Nervously Nearing Retirement? Four Do’s, Four Don’ts and One Never
To Create a Happy Retirement, Start With the Three Ps
Why Are You Still Working?
Five Common Retirement Mistakes and How to Avoid Them
The appearances in Kiplinger were obtained through a public relations program. The columnist received assistance from a public relations firm in preparing this piece for submission to Kiplinger.com. Kiplinger was not compensated in any way.
Investment advice is offered through APO Financial Services, LLC (“APO”) 10155 Westmoor Drive, Suite 175, Westminster, Colorado 80021-262, an investment adviser registered with the Securities and Exchange Commission. Registration with the SEC should not be construed to imply that the SEC has approved or endorsed qualifications or the services offered or that its personnel possess a particular level of skill, expertise or training. Important information and disclosures related to APO are available at https://apofinancial.com. Additional information pertaining to APO’s registration status, its business operations, services and fees, and its current written disclosure statement is available on the SEC’s investment adviser public website at https://www.adviserinfo.sec.gov.
This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.
Sponsored Content
-
You Don't Have to Be Wealthy to Need a Wealth ManagerNavigating complex financial decisions is hard on your own, no matter how much money you have. A wealth manager can provide comprehensive financial planning, investment management, risk management and more.
-
Despite Tariffs, These Investment Experts Are Bullish on European EquitiesEuropean equities were one of the better-performing investments during the first half of 2025. They could be a good long-term prospect for U.S. investors needing to diversify, according to these investment managers.
-
How Do You Know You Are Ready for a Gray Divorce? 15 Yes-or-No QuestionsAs people 50 and older get more gray divorces, many splits are initiated by women who want a new path. Answer these 15 questions to see if you might need to think about how you should move forward.
-
'Buy Now, Pay Later' for Everyday Spending? This Financial Pro Thinks It's Risky'Buy Now, Pay Later' apps can get you out of a jam when you need money quickly. But using them regularly for small purchases could create problems.
-
Five Things to Consider Before Rolling Your 401(k) into a Roth IRAConverting at least some of an old 401(k) to a Roth IRA can offer long-term tax benefits and retirement flexibility, especially if you anticipate being in a higher tax bracket later or wish to leave a tax-free legacy.
-
From Dream Apartment to Nightmare: When Your Landlord Evicts You Through No Fault of Your OwnThis is what I suggested a tenant do to get out of her lease after her landlord's inexperience and lack of action made her rental situation unsafe. It's a legal situation called 'constructive eviction.'
-
Six Steps to Being Empowered and On Track: An Expert Financial Guide for WomenWhile most female investors feel on track with their financial goals and empowered by managing their investments, many regret not starting sooner. Here's how you can get started and take control of your financial future.
-
Selling Your Business? This Powerful Insurance Option Unlocks Multigenerational WealthPrivate placement life insurance (PPLI) offers almost unbelievable investment flexibility, estate planning and tax advantages. And it's completely legit.
