The Retirement Readiness Checklist

In May, Met Life issued a 28-page report, quantifying where Americans stand in terms of their preparation for retirement.

Dan Richards

Their readiness index measured fifteen tasks – attached to the report was a questionnaire that advisors can walk clients through to benchmark where they stand on each task and identify areas that need improvement.

The fifteen tasks for retirement readiness

The fifteen tasks fall into five areas:

Activities related to income and benefits

This includes assessing when full time retirement will be financially feasible, evaluating the impact of changes in the economy on pensions, investments and retirement benefits and determining what has to be done to receive the company and Government benefits to which clients are entitled.

Work related tasks

This makes up five of the fifteen things to do.

These include deciding whether to fully retire or work part-time, identifying the options for full-time or part-time work in retirement, figuring out if skills can be easily transferred to part-time work and  exploring alternate career or part-time opportunities in retirement.

Leisure-related activities

Leisure-related tasks include things like determining the balance between work and leisure in retirement and identifying personal goals in retirement.

Relationship tasks

Relationship tasks to prepare for retirement capture thinking through the impact of retirement on relationships with a spouse, family and friends and also considering the effect on relationships with co-workers.

Planning for retirement

This includes determining what it will take to have a satisfying retirement, identifying alternate plans should there be an unexpected setback related to health or financial issues and evaluating whether retirement plans meet the demands of potential changes.

Conclusions about retirement readiness

This report reached a number of general conclusions.

First, getting ready to retire is more complicated than just having enough money – there are many dimensions to a satisfying retirement.

In fact, the report points out that existing retirees need to provide a road map to what has to happen to maximize the odds of a satisfying and fulfilling retirement.

And second, completing these tasks doesn’t mean that someone should retire – but it does mean they can retire, when they’re ready to retire.

The current thinking on the timing of retirement

Americans are about evenly split on when they plan to retire – about half plan to retire at the age they’d been planning to a couple of years ago, the other half say they plan to work past the date they’d planned.

Existing retirees

About 64% of existing retirees say they retired earlier than they’d expected, 33% retired when they’d expected and only 3% said they’d retired later than expected.

The survey didn’t ask if early retirement was voluntary – in all likelihood there were some cases in which companies made the decision for these early retirees.

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