As I approached my last day of work, I wasn’t quite sure what to expect. After all, this was my first time to prepare for my last day of work! It was time to retire — what happens now? However, because I had prepared long in advance for that day, the transition to, and retirement itself, has been great!
As your last day of work approaches, you may be nervous about the future. You know things certainly are going to be different. Your routine of carrying out the responsibilities of your job and spending many hours among coworkers will be no more. You will leave the familiar to develop and focus on new routines and maybe new or different relationships. For this transition to be enjoyable, you must plan purposefully before that day arrives.
One of the most important things to consider when preparing for your final day of work is finances. You may have wondered, “When should I start saving for retirement?” The simple answer is, “If you haven’t started yet, start now.” The earlier you begin saving for retirement, the better.
I was employed by the Free Will Baptist Board of Retirement, now Richland Ave Financial, for 32 years. As I look back on my final day of employment, I rejoice that I had peace with my decision to retire. That peace came from 32 years of preparing for that day.
When I began work there, I knew little about the importance of retirement planning. I quickly realized how much preparation I had already let pass by. With my first check, I opened a retirement account that received contributions through automatic deductions from my weekly wages. That routine continued for decades until my very last check.
At the age of 36, retirement seemed far away, but I realized I needed to set some firm financial goals so when my wife Ida and I reached that point, we would be able to experience the kind of life we had talked and dreamed about.
To preserve the same standard of living maintained while employed, a person generally needs 70–80% of pre-retirement income. Some expenses will probably decrease when you no longer work. For instance, no commuting to work and back. You may save on clothing and not eating out for lunch as often. But some expenses will likely increase, one being the cost of healthcare. In retirement, you will probably be responsible for your own medical insurance, prescription drug coverage, and dental and vision coverage. Also, as we age, people tend to experience more complex health issues that require more doctor and hospital visits.
Another financial issue to be considered in preparation for your last day of work is debt. We should carry as little debt as possible into retirement. One major item to consider is your mortgage. Consider the boost to your spendable income without a home mortgage. Also, avoid high-interest credit cards. It is okay to use credit cards, but only if the balance is paid each month to avoid paying high interest and penalties for late payments. Credit cards are available that offer cash back or flight miles on every purchase. If you use credit cards in retirement, make them work for you.
Another consideration for that last day of work is, “Where do I want (or need) to live?” Some questions to consider when planning where to live in retirement include: Can I afford it? Is healthcare available nearby? Are family members nearby? What senior activities are nearby?
Another important part of retirement planning is to prepare mentally. Even if your finances are in order, if you are not prepared mentally and emotionally, that last day may produce dread rather than joy. You need to ask, “What will I do with all my new free time?” This is an important part of retirement planning. Have a plan, including new things you want to explore. The point is simply to think about what you want to do before you retire, so you have new horizons and adventures to enjoy.
Plan, so when that last day of work arrives you are ready to face an exciting new chapter. It will be worth it if you are ready when retirement comes.
About the Writer: D. Ray Lewis joined the Board of Retirement (now Richland Ave Financial) in 1982. He became the director in 2005 after serving for several years as the assistant director and retired in 2016. Ray and his wife Ida currently live in Indiana.
