Retirement

Once you make the decision to retire, allow about 2 years to get everything in order prior to quitting your job. I can hear the collective question resonating, "Really?  Two years?  Why that long?  Why can't I just walk into the human resources department and give my two week notice?"

It's not that simple, folks.  Nothing ever is.

Before you even think about that retirement date, I strongly suggest meeting with a certified financial planner.  In this day and age, any job that offers any kind of real pension has certified financial planners available to you most of the time for free - or if they do charge, it's very affordable.  It's part of your retirement benefit.  Your employer does NOT want you to retire and not know what is in your financial future.  Trust me.

Now.  Here's the hard part that nobody can do for you no matter how you avoid it or want to pawn it off onto somebody else.  This is the crucial part and you are solely responsible for this bit of information:  You will need to take the time and effort to figure out how much you owe (i.e., mortgage, car payments, credit cards, etc.).  You will also need to figure out what your anticipated income sources will be post-retirement (social security, pensions from previous employers, etc.).

Things to factor in when making the decision to retire are your anticipated living expenses (house payment, utilities, travel, rent, etc.).  Where are you going to live?  What will happen if you become incapacitated?  Who will make decisions for you?  Do you have a living trust or a will?  How long do you think you're going to live?

I know, I know.....it's overwhelming.  I don't want to deal with it, either.

Now that you've made the decision to retire and have your financial and legal affairs in order (I'm sure just the beginning step took a good 6 months) it's time to give your notice to the employer.

Meet with your employer's benefits department prior to giving notice of your intention to retire.  Yes, you have a pension plan, maybe a 401(k) plan, and other company benefits you have worked hard to accumulate over the years.  However, it can take TIME before your application for retirement to be approved and processed.  Depending on the retirement criteria spelled out in the Summary Plan Document (SPD) you may need to meet certain benchmarks prior to taking any distributions.  Many people think they have put 30 years in and they are done.  Nope.  Not that simple.  There could be a multitude of requirements you need to meet in order for you to be 100% eligible.  A common mistake is that you've been working for the same company for 30 years, but you worked full-time for 20 and part-time the last 10.  Depending on how your plan is drawn up, that could be a huge difference to you.  You may discover you need to work an additional 5 years full-time to qualify for the full benefit. 

Social security does not happen instantly, either.  There will be major decisions that you will need to make.  Who would think that drawing on your social security could be so complicated?  

The point here is that when you decide you want to retire, the last thing you need is to be surprised financially.  Yes, it takes time and effort and it's not fun, but the onus is on YOU to pull all the information together.  Again, like dying, nobody can do it for you.