What To Do After You Retire

You’re retired! Congratulations! Retirement is a goal most people dream of. … But now what? What do you do about your assets now? 

There are retirement checklists that help bring you to the point of retirement, but what about wealth management for retirees? How do you keep your money growing and make sure you don’t outlive your assets? 

At Oliver Wealth Management, we work with a lot of retirees, and we know a lot of their concerns, so we’ve developed a checklist for this phase in life too. 

When you’re retired, don’t assume that there is no longer a need to keep yourself on track or pay attention to your finances.

Nothing could be further from the truth. Checklists in retirement can help you continue to optimize your financial life and plans. Pre-retirement, your calculations on how much you may need and how you plan to spend your time are the focus. In retirement, however, you know more about how your life is actually going.

A checklist for after you retire can also help you see the need for adjustments. You may need more or less money in a particular category. You may have moved or downsized and have a concrete sense of how those changes have affected you. You may have a better sense of your tax environment as a retiree, or a more nuanced sense of your healthcare needs.

While your working years may be over, there are still some important steps to take in retirement. 


Talk to the financial advisors at Oliver Wealth Management about what you should be doing in retirement to make your money last. 


Understand Your Retirement Benefits and How to Best Utilize Them

If you took Social Security benefits when you retired, the amount you’ll receive is fixed (except for periodic cost-of-living increases). But many people retire before they begin to take Social Security.

If you haven’t yet begun to take Social Security, you can manage the amount you’ll receive. The amount recipients can receive increases on average about 8 percent every year between full retirement age and the age of 70. Your full retirement age is determined by your birth year. It’s 66, for instance, for people born between 1943 and 1954.

Many couples maximize the amount of Social Security income by drawing one spouse’s Social Security benefits until the other reaches 70. Don’t forget about the second’s benefits when you’re already retired. 

If you are withdrawing money from your retirement accounts, such as Individual Retirement Accounts (IRAs) or 401(k)s, assess whether you want to adjust the amounts going forward. A commonly used rule of thumb is the 4 percent rule, which allows people to withdraw 4 percent of their portfolios for 30 years without running out of money, assuming a portfolio is divided roughly equally between stocks and bonds. Does your portfolio allocation need to be adjusted? Talk with a financial advisor. 

Finally, be aware that you can begin withdrawing from qualified tax-advantaged retirement accounts at the age of 59-½ – and you must begin withdrawing from them when you reach age 70-½. There can be very steep tax penalties if you do not take Required Minimum Distributions (RMDs) at the mandated age and every year thereafter.

The formula for determining your RMDs is based on your life expectancy and tax laws. It can be complex, so it’s prudent to work with a financial advisor when determining the RMDs you need to take.

Know Your Tax Implications

RMDs are one area where tax planning is essential, as failure to plan can have severe consequences. But it’s also a good idea to work with an advisor on overall tax planning and its implications in retirement.

If you are living on investments that are not in tax-advantaged retirement plans, for example, you may be paying hefty taxes. Consult with an advisor about strategies to minimize those taxes as much as possible.

In general, Social Security benefits are not taxed. However, that changes if you are receiving significant income from other sources, such as dividends, self-employment or wages. 

Remember, retirement planning in Towson MD is different than in other areas. Read our recent blog post to see what you can expect living in Maryland: What You Need to Know About Retiring in Maryland. 

Review Your Estate Plan

An estate plan, at a minimum, consists of a will, which is a legally binding document specifying where and to whom you want your assets to go upon your death. 

Without a will, your spouse and any dependents may have a difficult and lengthy road ahead of them before they can receive any assets from your estate. Your estate may not be divided as you wish. Beneficiaries not related to you may not be able to receive anything without a will.

It’s a good idea to review the provisions of your will at least once a year. Why?

  1. Your assets may change. They may appreciate or lose value. You can also gain or sell assets entirely, of course. You want to make sure that the amount of each bequest is what you wish. 
  2. Your beneficiaries themselves may change. Your beneficiaries may die, get married or move. You may marry or have children or grandchildren in retirement. You want to make sure that you don’t overlook a beneficiary or have people or organizations named as beneficiaries in your will when such a designation is no longer applicable or desired.
  3. Your life may have changed. Healthcare or other expenses, for instance, may cause you to draw upon your own assets more than you anticipated. 

An estate plan should also include powers of attorney and medical powers of attorney. A power of attorney gives someone the legal authority to make decisions about your estate should you become too ill or incapacitated to make them yourself. A medical power of attorney gives someone the legal authority to make decisions about your medical and end-of-life care should you become too ill or incapacitated to do so, including orders such as “do not resuscitate” and overall healthcare management.

Both types of powers of attorney can be durable, which lasts for the duration of your life, or nondurable, which end when you become able to see to your affairs again.

As you can see, the need for periodic review of your income streams, your assets, your taxes and your estate doesn’t stop when you leave the work world. In fact, in many ways, wealth management for retirees becomes more complex. As a result, checking in with a financial advisor at least once a year is one of the most prudent moves you can make, even in your Golden Years.