Four Phases of Retirement: Introduction

Years ago, when you mentioned the concept of retirement, visions of a long and relaxing stretch of time after your career came to mind. Most people envisioned having a 20-30 year time span filled with activities such as traveling to exotic locations, leisurely days of relaxation and recreation and time with grandchildren. The possibility of long-term care was usually the only concerning issue in retirement.

Times have certainly changed!

Today the concept of retirement has taken on a new meaning. The cost of living has become very expensive and those who would like to enjoy their mature years are finding that it is becoming less and less financially feasible. In order to realize their dreams, retirees are finding that simply living off of social security and a savings account is not enough.

Some people have saved their entire lives with the intent of being able to enjoy the golden years, but when putting together a plan for living comfortably from these savings, they now have to take into consideration many factors, including:

  • The impact of inflation.
  •  How much you can afford to take out of your retirement plan each year.
  • What required minimum distributions, if any, do you need to take from your retirement plan.
  • What financial benefits you may have if you delay your retirement.
  • What mortgages, large debts and bills you may have outstanding.
  • The total amount of wealth you have collected and saved for retirement.
  • Your health and long-term care costs during retirement.

These are just a few of the complex issues that retirees need to consider. A good strategy for approaching and preparing for retirement is through a well-executed, long-term plan. Sadly, the reality for many people is that their lifetime may have included unexpected situations like an untimely death, a divorce, an unfortunate disability, or any one of a number of unpredictable and unpreventable obstacles that changed or altered even the best of intentions. As a result, many people today find themselves in the twilight of their working years having saved less for their retirement than they anticipated and scrambling to find a way to compensate or make up for the cash they will need­­ to realize the retirement they once desired.

For many Americans, retirement today can be broken down into four phases:

  1. Pre-retirement;
  2. Early retirement;
  3. Full retirement; and
  4. Final retirement.

We will highlight each phase over the next four weeks.  The bottom line is that throughout each stage of retirement it is wise to make sure that you plan and monitor. Remember, the only thing that is constant is change!

Our role at the MFS Group is to help and assist you through each stage of your retirement. We take great pride and satisfaction in reviewing each of our client’s individual situations and needs. Our goal is to fully understand and review your retirement and estate planning needs.

We hope you return the next four weeks to read more about the four phases of retirement.