Most retirement conversations start with a single question: “Do I have enough?” It is an important question, but it is rarely the whole picture. Retirement readiness involves income structure, healthcare, taxes, and, just as importantly, what you plan to do with your time. Here are five questions we encourage anyone within a few years of retirement to think through.
1. What will my spending actually look like?
Rules of thumb like “plan for 80% of pre-retirement income” can be a reasonable starting point, but real spending is personal. Many retirees spend more in the early, active years on travel and family, then see spending shift toward healthcare later. Building a realistic budget based on your actual lifestyle, rather than a generic percentage, gives every other part of the plan a more solid foundation.
2. Where will my income come from, and in what order?
Paychecks are simple; retirement income usually is not. Social Security, retirement accounts, taxable investments, pensions, and part-time work each have different tax treatments and timing rules. The order in which you draw from these sources can affect how long your money lasts and how much tax you pay along the way, which is why withdrawal sequencing is a core part of most retirement plans.
3. When should I claim Social Security?
You can generally claim Social Security as early as age 62 or delay up to age 70, with monthly benefits increasing the longer you wait. The better choice depends on your health, family longevity, spousal benefits, and other income sources. There is no universally correct answer, only the answer that fits your circumstances.
4. How will I cover healthcare before and after Medicare?
If you retire before age 65, bridging the gap to Medicare eligibility is often one of the largest and most overlooked expenses in a retirement plan. After 65, Medicare covers a great deal but not everything; premiums, supplemental coverage, and potential long-term care needs deserve a line in the budget rather than an asterisk.
5. What am I retiring to?
The happiest retirements we see are rarely defined by a portfolio balance. They are defined by purpose: family, travel, volunteering, part-time work, or a long-deferred project. Thinking about how you want to spend your weeks is as much a part of retirement planning as any spreadsheet.
If you are within five years of your target date, that is generally the right window to stress-test your plan while there is still time to adjust course.
Important disclosures
This article is provided for educational and informational purposes only and should not be construed as personalized investment, tax, or legal advice. The information presented is general in nature and may not be appropriate for your individual circumstances. Litchfield Financial, LLC does not provide tax or legal advice; please consult a qualified tax professional or attorney regarding your specific situation. Investing involves risk, including the possible loss of principal. Past performance is not indicative of future results. No strategy, including diversification or asset allocation, assures a profit or protects against loss in declining markets.
Litchfield Financial, LLC provides investment advisory services through Claro Advisors Inc. (“Claro”), a registered investment advisor. Claro Advisors Inc. is a Registered Investment Advisor with the U.S. Securities and Exchange Commission (“SEC”) based in the Commonwealth of Massachusetts. Registration of an Investment Advisor does not imply any specific level of skill or training. Information contained herein is for educational purposes only and is not to be considered investment advice.
