Retirement Planning Guide: Things to Consider Before You Retire

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All of us are going to have to retire someday, and making sure that we have enough money to live on is absolutely vital.

But determining how much money that might be is something that everyone struggles with.

After all, everyone’s retirement is a little bit different. Some people are going to have more bills than others because of medical situations or having paid off large purchases such as their home.

However, it is possible to estimate how much you might need for retirement with little information. Let’s take a look at the specifics.

How People Normally Retire

Saving for retirement conventionally is usually done by those who are employed full-time. Full-time employees may have a 401(k) that they pay into and their employer matches the amount which prepares them for retirement.

When they reach a certain age, and they retire from the company, then that 401(k) can provide them with income.

Many people supplement this by saving their money, investing or other activities that give them the money that they need for retirement.

Of course, not everyone has an employer with a 401(k) set up. Some people have two part-time jobs and do not qualify for full-time benefits.

There may be other reasons why they do not have an employer-sponsored retirement plan. But there is a government plan that you pay into each month that will provide you with benefits when you retire. This is called Social Security.

In addition to paying into Social Security, you can save your own money that will allow you to supplement any income you get from Social Security.

What is a 401k?

Read: What is a 401k?

Calculating How Much Time You Have Left After Retirement

One of the first things that you are going to want to do is calculate how much time you have left after retirement. This means that you first have to set a retirement age. Without a starting point, it is impossible to know how many years you I have left that you should be planning for.

Once you have determined what age you plan on retiring, then you should take various things into consideration such as your family history and any health problems you have that could affect how long you have left.

Genetics definitely plays a role in determining what age you will live to. If most of your ancestors lived until age 80 or so, then it is a good bet that you will also live to that age barring any health problems or accidents. Generally, age 80 to 85 is a pretty good bet for anyone wishing to find out how many years they have left after retirement.

That means that most people need to plan for at least 20 years. If you can come up with investment like this, then you will be able to determine how much you need per month to live based upon your lifestyle and spending habits and how much you will need to save to reach that goal before retirement.

What's the Difference Between a 401k & an IRA

Read: What’s the Difference Between a 401k & an IRA?

Paying Off Expenses before Retirement

If you can get most of your expenses paid up before retirement, then you are not going to need to save as much. For example, if by the time you retire, all of your cars a been paid off and are still in good working condition, your house is paid off and any loans or other major bills that you had have been taken care of, then you will need of much smaller amount per month to meet your expenses or you will be able to have a better lifestyle.

Some people prefer to pay off their homes, even if they still owe a little money on them, and by a smaller place and then put whatever is left over towards their retirement savings. The same goes for vehicles. If you are retired, then you may not need as many vehicles as you did when both you and your spouse were working.

Selling off a car can put a few thousand dollars toward your retirement savings as well as save you on expenses like gasoline, insurance, vehicle maintenance and more. Most people pay off their cars in about five years while most mortgages are somewhere between 20 and 30 years so it is perfectly reasonable to plan for having everything paid off.

Factoring in Healthcare

Healthcare is going to become even more important as you get older. The older you get, the more health conditions you are at risk for.

Of course, you will have access to Medicaid, but that doesn’t cover everything. If you have a chronic condition or have the potential to develop on based upon family history, then you definitely want to factor this into your retirement plan.

Treatments for this condition, medications, surgical procedures, checkups and all the other medical expenses are not all going to be covered by Medicare so you will have to pay for some of it out of your own pocket.

Even if you do not develop a serious illness or condition, you are still going to need more checkups and more prescriptions as you get older unless you are the pinnacle of health.

Most people require more healthcare as they get older because the immune system is not as strong as it once was and you are at risk for various diseases such as osteoporosis, arthritis, heart conditions, blood pressure conditions and more.

That means that you are going to spend more on medical costs and is the whole reason that Medicare was created in the first place.

Your Expected Lifestyle

The kind of lifestyle that you expect to lead is also going to be a consideration in how much money you need.

If you plan on staying in your house and living a very simple lifestyle without taking expensive vacations, then you are going to need a lot less than someone who wants to travel all over the world and see far-off exotic places.

You might even want to buy an RV and travel throughout the United States, but even that is going to cost more than someone who plans on staying at home and using television, Internet and various social activities as their main form of entertainment.

Many people dream about their retirement being a golden age where they get to do all the things that they hadn’t done before and purchase all of the things that they hadn’t been able to purchase before.

So, if you plan on buying a boat, taking cruises and spending a great deal of time away from home, then you’re going to have to plan for all of those expenses when you are planning out your retirement.

Otherwise, you may find after the first couple of cruises that you take that you have no more retirement savings.

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Creating Other Income Sources

You might be able to create passive income sources that will allow you to make money even if you do not actively work them.

This is something that is quite popular these days due to the Internet. If you can cultivate other income sources, then you have a good chance of being more comfortable in the retirement age because those passive sources of income may still be as viable as when you started.

In fact, if you keep working at them until you retire, there is a good chance that they will be significantly larger by the time you do retire.

As for which sources of income you may pursue, there are a lot of ways out there to make money online these days.

Some people write fiction or nonfiction books and publish them on Amazon. It does take several years and perhaps a dozen or more books to get a following – and you have to be a good writer in the first place. You might start some websites and rank them to the top so you can earn advertising money through search engine optimization.

Some people even start YouTube accounts and then publish videos of their blogs or top 10 lists or whatever they want to publish and build their list of subscribers until they can monetize their videos and begin making money from them.

How to Make Money Online at Home

Read: How to Make Money Online at Home

Increasing Your Retirement Savings

There are several ways to increase your retirement savings as well. For one thing, you should put it into an account where it is going to accrue interest. That’s the very least that you should do.

This might be a certificate of deposit or it might be a regular savings account.

If you have a retirement plan through your workplace and your employer will match you up to a certain amount, then consider paying more in then you currently are. If your employer is going to match your funds, then you should try to pay and is much as possible because you will be doubling your money every time you do.

There is also an IRA that can be a big help for retirement savings.

But the main thing that you can do to increase your retirement income is smart investing. Of course, no investment is perfectly safe, but if you have a wide and varied portfolio and either you or your broker are making really smart investment decisions, then the chances are good that you are going to arrive at retirement age that you are going to have more money than you invested in a significant nest egg for retirement.

It all depends on the market of course, as well as which decisions you make along with your broker and how much you invest, but most people find that this is a viable retirement plan.

What is an IRA

Read: What is an IRA? Complete Guide to Individual Retirement Accounts

Getting Professional Help

You should always be willing to seek professional help when it comes to your retirement. There are lots of financial advisors out there that will help you to save for retirement and make smart decisions on what to do with the money that you have already saved.

You may not be aware of all the options that are out there, so it is definitely recommended that you meet with someone who is an expert in retirement savings at least once.

They may have ideas on financial products that you may not have considered or they might have ideas on how you can increase retirement savings over the long-term.

Of course, you want to be selective when it comes to choosing someone to help you manage your money. There are plenty of unscrupulous people out there who will not increase your retirement savings at all but instead will make poor decisions or give you bad advice because they are only looking to line their own pockets.

You want to carefully check everyone out on the Internet beforehand including reading customer reviews and finding out if they have been able to help other people in your situation before and if they are a solid company with a good reputation.


The bottom line is that when it comes to retirement, there are a lot of things to consider. You have to first figure out how long of a period of time your retirement savings needs to last for.

You also need to determine how much you are going to spend each month of that retirement savings based upon the type of lifestyle that you want to lead in your retirement.

These are all goals that you should make long before you get anywhere close to retirement age.

Most people start thinking about retirement in their 40s or even later. But you should be thinking about retirement long before that.

Starting in your 30s would be better, but even if you are in your 20s right now, thinking about retirement down the road is excellent financial planning.

The longer period of time before you actually retire the more you can make things like individual retirement accounts, investment accounts, interest rates on savings accounts and all of the other financial assets that you have with retirement savings work for you.

You might be surprised on what a huge difference just an extra decade can make with your retirement savings.


Oliver Dale is Editor-in-Chief of MoneyCheck and founder of Kooc Media Ltd, A UK-Based Online Publishing company. A Technology Entrepreneur with over 15 years of professional experience in Investing and UK Business.His writing has been quoted by Nasdaq, Dow Jones, Investopedia, The New Yorker, Forbes, Techcrunch & More.He built Money Check to bring the highest level of education about personal finance to the general public with clear and unbiased


  1. Avatar
    Tyler Johnson Reply

    That’s a good die to calculate how much you would need to spend each month. I would think that it would be nice to have some passive income that would help make that amount a bit bigger. I’ll have to consider talking to a financial planner to have some help in investing for retirement.

  2. Avatar
    Dennis Sanchez Reply

    It never occurred to me that one of the things you need to do before retiring is to calculate how much time you’re going to have left after you retire. I’m not anywhere close to retiring and I’m not sure I’ll ever be able to retire. When that time comes, however, I’ll definitely keep this information you shared in mind.

  3. Avatar
    Lloyd Bronson Reply

    I am glad that the article mentioned getting professional help when it comes to retirement. My wife and I want to retire sometime in the future, but the task overall is quite daunting to us due to the many steps required both in the past and in the present. I think that we will consider someone to help us with our plight so that we can both live peacefully in our elder years.

  4. Avatar
    Flora | Privatefinancecare Reply

    Hello Oliver Dale,
    This is a great post and has motivated me and others to try this strategy. I am confused on how to start. I have a 401K but only contribute a small amount so that I have enough cash each month to pay the bills etc..I rather look at my savings each day or week and then invest a certain amount to a fund. But can I also invest in a Roth, since I don’t know if I am eligible because of my combined income with my wife. Or is there a good taxable account I could start maybe. Confused investor!!

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