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Questions for Retirees

January 18, 2019 | Posted in: Insights, Wealth Strategies

Retirement means different things to different people. For some it is a chance to relax, spend more time in leisurely pursuits, and enjoy the companionship of friends and family. For others it is an opportunity to start a business, engage in community service, or try a new career without the need for a previously earned rate of income.  For everyone, retirement presents decision points which will have lasting impact on the “third act” of one’s life.  Below are questions that anyone facing retirement should consider.

Cash Flows

Do you know how much money you will need each month? Does this number include Social Security benefits? Is this a pre – or post – tax number?
Have you tested the sustainability of your current retirement plan? How confident are you in the results?
What income streams do you plan to utilize to fund your retirement?

Any retirement plan must start with a realistic assessment of the income needs of the retiree. It can be tempting for individuals to settle on a monthly amount that covers regular expenses while ignoring the emergencies and unplanned expenses that inevitably occur.  Ignoring the impact of taxes or relying on overly simplistic retirement calculators can create a false sense of security about the health of one’s retirement planning strategy.


What date will the retirement be effective?
Have you contacted your CPA or done tax planning for the upcoming year?

Individuals who retire before age 59 ½ will withdraw from taxable accounts to avoid any penalties, and those who are 70 ½ will have to consider required minimum distributions (RMDs). Individuals who have assets in both taxable accounts and IRAs can (hopefully) avoid pulling from IRAs until after they are required to do so, delaying the ordinary income tax hit.  A Certified Public Accountant can help the retirees determine what percentage of the Social Security benefit (if any) will be taxable and how much income tax should be withheld.

Social Security

Have you reviewed your Social Security benefits? If so, have you decided when and how you will file to receive the benefits?

Social Security is very complex and detailed. A few salient points for general knowledge are included below:

Individuals can retrieve their most current statement by logging into and creating an online account.
Taxes can be withheld from the benefits.
Benefits can be considered taxable depending on other sources of income throughout retirement. The retiree’s CPA and/or the Social Security website can be good resources for determining what percentage of the benefit will be taxable.

A financial planning professional can conduct a thorough review and analysis assuming the individual has not yet begun receiving benefits.

Health Care

Have you enrolled in Medicare?
Would it be helpful to have a Medicare benefit options analysis?  

Health care costs can escalate as retirees age, and reviewing Medicare options can be overwhelming. Working with a professional can ease the burden of determining the best – and most cost effective – insurance options.

Legal Planning

Have you updated estate documents (wills, trusts, powers of attorney) and health directives (living will and HIPAA authorizations)?
Have you recently checked all of the beneficiaries to make sure they still reflect your wishes?

Retirement planning creates an excellent opportunity for individuals to ensure that all estate documents reflect their current wishes. For singles, next of kin will have HIPAA authorization.  If the retiree desires to give that authorization to someone else, he or she will need to reflect that in an updated document.

Assets with a named beneficiary will pass directly to those beneficiaries regardless of other provisions in the decedent’s will.

Insurance Planning

Have you evaluated long-term care insurance?
Do you have any life insurance in force?

Insurance professionals can help retirees determine if there are policies in force that could be dropped and/or if other policies should be introduced.