Countdown to Retirement (The 5 Year Plan)

If you’re nearing retirement within the next five years, then you probably have a lot of the retirement “must-dos” checked off your list. When you’re approaching the five-year mark and sooner, you’ll start thinking about other issues than maxing out your 401(k) and how much in Social Security benefits you’ll be receiving every month.

Review your asset allocation

Ensure that all of your ducks are in a row regarding your assets. Where are your investments? Do you need to relocate any money to make sure you reap a better investment? Now is the time to speak with a financial advisor so that you know you are making the best choices for your financial health. Know where your retirement withdrawals are coming from and how much you will be receiving.


This is the perfect opportunity to downsize your house, cars, and other elements of your life. As your kids grow and move on, you have probably realized you don’t need as much space. Remember that as you get older there is a possibility you will have mobility issues. This can affect going up and down the stairs and getting around a large house. Downsizing before these potential issues is a good idea and you will be able to save more money for your retirement.

Pay off debt

This shouldn’t be news to those nearing retirement, but if you are in debt and planning to retire soon, it’s important to pay it off ASAP. Pay off your cars, your credit card, and ideally, your mortgage. Retirement means a fixed budget for the rest of your life, and debt will severely cut down on your quality of life.

Look into Continuing Care Retirement Communities (CCRC)

Continuing Care Retirement Communities (CCRC) can be a great way to spend your golden years, depending on your health. From AARP:

“The nation’s nearly 2,000 continuing care retirement communities offer different types of housing and care levels based on a senior’s needs and how they change. A resident can start out living independently in an apartment and later transition to assisted living to get more help with daily activities or to skilled nursing to receive more medical care while remaining in the same community.

The chief benefit of CCRCs is that they provide a wide range of care, services and activities in one place, offering residents a sense of stability and familiarity as their abilities or health conditions change.”

Because of the high level of care that many of these communities offer, cost can be a deterrent. If you are hoping to live in one of these types of communities in the future, start planning now.

Do your research regarding healthcare

Make sure you understand what type of healthcare you will need. Medicare will not necessarily cover all of your healthcare costs, so it’s important to keep these expenses in mind. Couples who retire at the age of 65 will need to save an average of $285,000 just for healthcare costs. If you don’t plan for this, you may find yourself struggling in retirement.

Speak with a fiduciary financial advisor

A fiduciary is a financial advisor who is legally obligated to keep your best interests in mind. They will be able to work with you and your assets to help you get the best return on investment. Many financial advisors are experts in all retirement planning matters and they will be able to walk you through different scenarios you may find yourself in. This is one of the best ways to prepare yourself for retirement, especially during the last five years before you do so.

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