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Five Steps to Take One Year Before Retirement


Planning for retirement can feel like a distant goal until it’s right around the corner. After years of work and saving, the final year before retirement can be filled with excitement and anticipation—or anxiety about the unknown. Regardless of how you feel, now is the time to take crucial steps to ensure you’re well-prepared for this significant life transition.

Beyond simply managing your retirement accounts and investments (which is important and should be done in consultation with a financial advisor), consider these five essential steps about a year before you retire—because they may become more challenging to address later on.

Maximize Your Benefits and PTO: Take full advantage of the benefits offered by your employer, including paid time off (PTO). Review your company’s policy on unused PTO—can you carry it over or will you lose it upon retirement? Plan how to use these days wisely now, whether for relaxation or to avoid losing them altogether.

Consider a HELOC or Refinance: If you foresee major expenses ahead, like home repairs or renovations, consider refinancing your mortgage or opening a Home Equity Line of Credit (HELOC) before retiring. It can be more challenging to secure these options without a steady income post-retirement.

Get a Comprehensive Medical Checkup: Prior to retiring, undergo a thorough medical checkup. Your employer-provided health coverage might be more comprehensive than what Medicare offers, potentially saving you significant costs if health issues are identified and addressed early.

Test Your Retirement Budget: Start living on the budget you’ve planned for retirement while you’re still working. This trial run will reveal any adjustments needed to ensure your financial plan aligns with your lifestyle and needs in retirement.

Research Medicare Options: Medicare can be complex, so take the time to research and understand your options well before retiring. Ensure you have the appropriate supplemental plans in place to cover any gaps in Medicare coverage, protecting both your health and your finances.

By addressing these steps about a year before retirement, you can navigate this transition more smoothly and confidently, ensuring you’re prepared for the next chapter of your life.