63: ADJUST AS NEEDED - NEW CIRCUMSTANCES OR LIFE EVENTS MAY CHANGE YOUR PLAN
Focus on paying off all your debt: whether it is your mortgage, credit cards, car loans, or student loans. To effectively manage debt, you should make sure you are making the minimum monthly payments for each loan, but you should focus on eliminating your highest interest rate loan first. Once you have paid back everything you owe on this loan start contributing the extra money to your next highest interest rate loan. Continue this process until you had no debt to avoid paying the most money over time. If you have substantial debt from multiple sources, consider packaging it all into a 30 year loan. This will improve your cash flow during retirement and allow you take advantage of the lowest interest rates possible.
Review your Estate Planning: If you have not already, you want to make sure your will is up to date, review your power of attorney, health care proxies and beneficiaries. This will allow for peace of mind during retirement and avoid major problems in the future.
Meet with your financial planner: If you do not have a financial planner it is the perfect time to find one. Talk to coworkers, family, and friends to find a professional you trust. Discuss different tax strategies that you can utilize to maximize your wealth for retirement. Also, ask for cash flow projections which will give you a firmer understanding of your retirement situation. Discuss different possibilities such as annuities, investments, and spending plans.
As you come closer to retirement it is important to understand all your tax savings opportunities so you can begin to lay the necessary frameworks. Chances are your taxable income will decrease significantly in the year following your retirement. Depending on how far your income drops you will have different tax opportunities to take advantage of. Talk to your financial planner about possible 0% capital gains tax or Roth IRA conversion.
ADDITIONAL RESOURCES AND INFORMATION:
How much does early retirement reduce Social Security Benefits?
Should you claim your Social Security at 63?
Going back to work after retirement: The Good, the bad, and the ugly.
Getting ready to retire? Here's a planning guide for the 5 years before your last day.