It’s likely that investing for retirement is the most long-range, expensive goal most of us will ever face. In the early years that far off future can be pretty vague, and many of us wait until we actually retire before putting a plan together, if we plan at all.

Smart retirees start thinking about what they want to be doing once they retire about five or so years before stopping work. By this time, people have decided that they want to retire, but are not totally certain of the date yet. You are close enough to see how you stack up both financially and emotionally, yet far enough away that you can make any needed changes. It gives you enough time to consider all your options.

Retirement Ready

The Dream Stage

The most common way to start retirement planning is to determine how much money we will need. But, there is no magic number for everyone. Each person, or couple, is unique. A happy, fulfilling retirement means different things to different people. The amount you need depends on your lifestyle choices, so you won’t know exactly until you decide on what you want to do.

Retirement is not a one-time event. It’s an ongoing process that can last thirty years or more. It begins with focusing on what’s truly important to you and defining your hopes for the future.

You probably have some idea of how you’d like to spend your retirement. But for now, don’t focus on the budget. Focus on ideas.

Start listing all the things you want to do. What activities will you continue, and what new ones do you want to try? These activities could include travel, socializing, being with grandchildren and other family members (how much time? every weekend or just special occasions), playing sports, volunteering, reading, gardening, or crafts.

This doesn’t have to be a bucket list – just things that will give you pleasure.

Get out your notebook and be as specific as you can. Don’t just write “travel,” write “take a round-the-world cruise,” or “see the African savannah by hot air balloon.”

Retiring Couples

Just because you’re married doesn’t mean you’re at the same place in your careers. Although you may be ready to focus on your flute playing, your spouse might still want to head to the office every day. Sometimes people aren’t quite ready to give up working yet for whatever reason.

But at some point you will be retired together, and before that time you need to have a serious discussion with your spouse. Partners often have dramatically different ideas about what retirement will look like. One RBC retirement poll discovered that nearly 70% of pre-retired Canadians aged 50 and older have yet to discuss their hopes for their post-career lives with their spouse or partner.

Communication is key. You and your spouse need to be on the same page. Often people have very different visions of retirement. You may want to buy a motor home and barrel across the country, whereas your spouse may want to spend more time with the grandkids, or volunteer for a favourite non-profit.

For decades you’ve spent most of your day apart. Spending 24/7 together can require some adjustments. So you’re not continuously in each other’s pocket, find a balance between the amount of together time and time you spend apart pursuing individual interests.

Prioritize

Once you’ve decided on what you want to do, start doing your homework. If a Mediterranean cruise is the first thing on your agenda, start researching cruise lines, look at prices and schedules, and so on. If you’d like to move to another province or country (either snowbirding or permanently), pull up all the information you can find and schedule at least a couple of visits to see what it would be like to live there. Also, investigate whether there are any tax or estate implications you need to be aware of.

You should get this research done well before your planned retirement date to find just the right options. If you find out something that changes your mind, you’ll have plenty of time to go back to the drawing board.

It’s wise to schedule the more strenuous activities for early on in your retirement. As you age, your energy level will likely drop, and health issues may appear that would make it more difficult for you to enjoy your activities.

Balance your goals into needs, wants, wishes and dreams.

Tim and Kathy, both 52, have discussed their ideal retirement goals, and what would be acceptable to them.

• Their ideal retirement age is 58 and the acceptable age is 65.
• They would ideally like to take a major trip every year, it would be acceptable to take a major trip every three years and a couple of minor ones in the off years.
• Ideally, they want to remain in their home and keep their oceanside cottage, but they would consider either downsizing their home or selling it and living permanently in the cottage.

There might be potential trade-offs and you may need to consider different scenarios. The couple wishes to leave their children a considerable inheritance and give bequests to various charities. However, Tim’s father is currently in a nursing home. The possibility of either of them also experiencing a serious illness with the resulting cost of nursing care may reduce or eliminate this goal. Or if they are really worried, they may look into long-term care insurance.

Schedule medical checkups now

To get the most out of your retirement – and life in general – you want to be as healthy as possible. A little preventative medical attention can go a long way.

Schedule a complete physical and dental work. Work with your medical providers on a plan to improve or maintain your health.

Commit to eating healthy, exercising, getting enough sleep, and staying mentally sharp with brain games.

Final thoughts

Retirement is the time when you’ll finally get to do all the things you’ve always wanted to do, but didn’t have the time or money to manage them.

Establish a preliminary retirement plan, consider multiple scenarios, and revisit the plan shortly before actual retirement.

Next up: Will your retirement nest egg be adequate? Gaining a clear understanding of all your resources.