The 1 Crucial Thing You Must Do Before You Retire

There is no “set” retirement age: Many retire at 65, some earlier, some later. The age at which you decide to retire depends on many factors, such as how long you want to keep working, how your health is, if you plan to stay in your house, and what kind of post-career lifestyle you’re looking to lead.

Regardless of when you decide to retire, it is essential that you start planning … yesterday. It’s never too early to get your retirement ducks in a row so you’re not left out in the cold when you finally flip the switch. Keep reading to find out the one most important thing you can do to plan for your retirement — and start today so you’ll be set for tomorrow.

1. Make a budget

Retirement planning written on a notepad

Create a budget for your future. | designer491/iStock/Getty Images

The No. 1 thing you can do to help you retire comfortably is to create a retirement budget. And, make sure you design one that reflects the lower income you’ll be receiving, advises MarketWatch.

It’s important to have a realistic vision of how much cash flow you’ll have when you retire — and you might have to make some adjustments to your lifestyle to live on it. Run the numbers, and trim expenses if need be. One way to do that includes downsizing your home, which might be a good idea to do now if the kids are already out of the house.

Next: Creating a budget shouldn’t be the only item on your to-do list. 

2. Create goals

Figure out what you want to do when you retire. | Philippe Huguen/AFP/Getty Images

Retirement isn’t all about having enough money. Your physical and mental well-being are also extremely important aspects of retiring. Keep in mind you’ll have much more time on your hands when you retire than when you were working — and make a plan to fill that time in productive ways. Whether it’s playing golf, volunteering, reading, or riding a bike, write a list of things you love to do and that will keep you busy. Then stick to it.

Next: Just do it

3. Get proper exercise

man doing ab exercises in the gym

Remember to stay active. | Barryj13/iStock/Getty Images

Exercising is something you should take up long before you retire. After all, the most important thing is your health, and exercising can reduce the risk of diabetes, hypertension, heart disease, and colon cancer, reports MarketWatch. Don’t forget that incorporating a regular exercise routine — for at least a half hour each day — will eventually lead to your being healthier when you retire, which means that your medical expenses will likely be a lot lower than average.

Next: See the world — now

4. Travel

senior couple of old man and woman sitting on the beach

Do it while you can. |

Here’s an idea: Don’t wait until you retire to travel. The older you get, the harder it is to sit on planes for hours and handle travel issues that inevitably come up. If you’ve always wanted to ski the Alps or drive through the French countryside, do it now while you’re still able to really get the most out of it.

Next: Avoid lifestyle inflation

5. Keep your budget constant despite salary raises

professor, teacher

Even if you get a pay raise, put the extra in savings. | monkeybusinessimages/iStock/Getty Images

Your income level will likely be the highest as you near retirement, according to GOBankingRates. Forget about spending whatever you make. Instead, stick to your orignal budget — even when you get salary raises. This will enable you to contribute more to your retirement funds and give you with more to live on when you make your move.

Next: Cut expenses

6. Trim your living expenses

senior cuts coupons

Save money where you can. | ConnieTBallash/iStock/Getty Images

It’s important to start streamlining your lifestyle before you retire. For example, take a look at your monthly overhead and see what you can cut — you’ll surely find something. Using a gradual approach to cutting expenses will help take the sting out of it when it’s actually time to retire.

Next: Identify all income sources

7. Understand what income sources you’ll have

Retirement plan with graphs and glasses

Work with a professional to figure out your options. | iStock/Getty Images

Long before you retire, take a look at all of your guaranteed income sources, suggests GOBankingRates. Count your Social Security benefit; your investments that generate income, such as a 401(k), IRA, or savings account; and any annuities you might have. It’s never a bad idea to consult a professional if you’re unsure about covering your retirement costs — a financial advisor can provide advice, solutions, and an unbiased perspective regarding the best way you can reach your goals.

Next: Save, save, save

8. Max out your retirement accounts

concept of Planning for retirement

Stock away as much as possible. | jerry2313/iStock/Getty Images

It isn’t easy to sock away money while you’re working. But a disciplined approach to saving can really boost your retirement account balances.

Try to automatically deposit some of your paycheck into your retirement accounts, For instance, if you have a 401(k), you might want to designate a percentage of your paycheck that goes into it each month, particularly if your employer matches your contributions. Wherever you can, whenever you can, save, save, save — when it comes time to retire you might be surprised at how much you have.

Read more: 9 Lies You’ve Been Told About Saving for Retirement

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