Planning for retirement isn't easy. There are so many imponderables and uncertainties: Will your health hold up? When will you die? Will an employer offer you a part-time job at age 66? What will be the value of your 401(k) in 5 to 10 years? What about the state of the economy? I could go on, but you get the point.
Yet the outcome of decisions you make today will make a huge difference tomorrow. The stakes remind me of the most famous lines in personal finance. They were written by 19th-century novelist Charles Dickens. In David Copperfield, the kindly but debt-ridden Mr. Wilkins Micawber advised a young David, "Annual income twenty pounds, annual expenditure nineteen nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."
To try and help you reach "result happiness" in retirement rather than "result misery," the Society of Actuaries has been running a series of Retirement Decision Briefs. They aren't literature, let alone Dickens. They're dry and straight-forward. But the actuaries know their stuff and they try to offer a solid framework of questions for thinking through your retirement.
The latest is "Big Question: When Should I Retire?" Among the questions it highlights are:
- Do I have enough money?
- What will be the impact of working one more year? Two more years?
- When should I claim Social Security benefits?
- Have I identified passions and things I wish to pursue in retirement? Is special travel on my agenda?
- Is my spouse retired? Do we have dreams we wish to pursue together?
- Does my spouse need support and help? Are there other family members who wish to have support and care?
- What are my preferences with regard to work, retirement, a different set of activities?
- For how long of a period do I need to plan?
- What is likely to change during retirement and how does that affect my plan?
- Where will I get medical benefits?
- Are there plans with regard to family members or family members needing care?
- Have I built enough flexibility into my plans?
I'm exhausted already. You can look at the Society's complete list of briefs here.
And for fun, you can read the results of a competition for the best actuarial jokes at this website.