What Financial Steps Should I Take in the Five Years Before Retirement?

The financial steps that you should take in the five years before retirement might include looking at your retirement savings and spending plan. First off, you need to know how much you’re planning on spending in retirement and then making sure that your savings plan is on track with that.

You don’t want to dramatically change your investment philosophy or approach just because you’re approaching retirement. You want to be very careful about smoothing out the transition from a perhaps more aggressive to more conservative portfolio, and that doesn’t have to happen dramatically.

Test your spending plan. You don’t want to be testing your retirement spending plan for the first time once you’re in retirement. If there’s any problems, you want to make sure you address those problems before you no longer have income coming in the door from a typical job.

So, in the five years before retirement, don’t change anything too dramatically, increase your savings or keep your savings on track, and test your retirement spending plan.

Parkshore Wealth Management is a family-owned, independent, fee-only Registered Investment Advisor serving the greater Sacramento area with an office in Roseville, CA. We partner with financially responsible individuals and families who are eager to take positive steps that will allow them to use their money to build the life they desire. The firm is led by Harold Anderson, CFP®, and Daniel Andersen, CFP®, both members of NAPFA, the country’s leading professional association of fee-only financial advisors.