If you’re heading into retirement without a firm financial plan, the transition may be more difficult. Here are a few tips to help get your ducks in a row.
Organize All Of Your Financial Records
When it’s difficult to find receipts, account statements, and other documents, it’s time to cull the clutter. You don’t have to hold onto financial documents forever. Here’s how long to keep specific records before they go into the shredder:
- Tax Records: 7 years (including records used to prepare your tax return)
- Property Records: 6 years after selling your home
- Mortgages & Loans: Indefinitely
- Bank Records: One year for checks and account statements
- Pay Stubs: Hold until you get your W-2 form to verify the correct information.
- Credit Card Receipts & Statements: Only until you can check receipts against monthly statements. Then keep the statements for a year.
- Brokerage Statements: 7 years
- Utility Bills: As soon as the payment clears
Now that you’ve de-cluttered, create hard copy folders or digital folders for the rest. For digital files, save backups on a portable hard drive or encrypted cloud storage service.
Look For Ways To Consolidate Accounts
As a Thrift Savings Plan (TSP) participant, you have the option of rolling over money from eligible retirement plans into your TSP account. These include a 401(k), 403(b), or a traditional IRA. And you can move money into your TSP while you’re still working or after you retire.
“Look into subscribing to a credit monitoring service that will alert you to any changes or suspicious activity.”
Check Your Credit Reports
Look for unfamiliar or incorrect information then start the process to correct inaccuracies. You’ll have to dispute it with each respective bureau, which you can do online, by phone, or by mail. The federal Consumer Financial Protection Bureau provides helpful tips for disputing credit report information. Look into subscribing to a credit monitoring service that will alert you to any changes or suspicious activity.
Put Together A Plan To Pay Off Debt
Baby Boomers poised to retire soon carry an average of more than $25,000 in non-mortgage debt. This includes credit cards, personal loans, auto loans, and college debt. When you’re living on a fixed income in retirement, a high amount of consumer debt is a threat to your financial security.
Conduct A Life Insurance Review
When was the last time you reviewed your life insurance policies? According to the experts, you should conduct a review at least once a year to ensure you have the right amount of coverage as your needs change.
Connect with an FRC® trained advisor to learn more.
