Retirement is more than just a change in work status – it’s a major metamorphosis that touches every dimension of an individual’s life. Yet, too few Americans have financial advisors helping negotiate this complex transition. Citing a report from the Society of Actuaries, Jamie Hopkins, Associate Professor of Taxation and a co-creator of the Retirement Income Certification Professional® (RICP®) program, writes in Forbes: “Only 52 percent of pre-retirees and 44 percent of retirees consult a financial planner or advisor.”

When clients have long-term relationships with advisors, their retirement income planning begins well before their last day of work. In fact, it’s common to begin discussions about retirement planning a full decade before a client’s anticipated retirement date. During this time, advisors walk clients through a series of conversations about finances, investments, relationships, work, and retirement lifestyle choices. Working through all the changes and planning the next phase of the client’s lifecycle can prepare clients and increase their chances of a smooth, comfortable transition.

Grandfather and granddaughter playing chess

It can be helpful for advisors working with retirement-minded clients to keep a checklist of all the decisions clients need to make. This list can be shared with clients online or during face-to-face meetings and may become a living document that tracks the client’s choices and provides valuable insight into the client’s thinking process over time.

A checklist such as the one below divides the questions/tasks into categories which can be helpful for framing discussions about retirement lifestyle.

5 Topics to Discuss Pre-Retirement

1. Determine aspects of retirement related to work/career with these questions:

  • Does the client hope to retire fully or work part-time?
  • Which of their skills could be easily transferred to a new part-time job?
  • Which alternate or part-time work opportunities are available?
  • How much would the client like to work in retirement?
  • What employment possibilities are available for working full- or part-time in retirement?

2. Establish an understanding of your client’s expectations about leisure activity:

  • What is the proper balance between work and leisure time?
  • Does the client have personal, professional, or charitable goals in retirement?
  • Are there any recreational activities the client has postponed that they want to start in retirement?

3. Ask your client to consider how retirement will affect their relationships:

  • Are coworkers important when making the decision to retire?
  • How will the various aspects of retirement affect the client’s relationships with friends?
  • Does the retiree have a support network in place?
  • What effect will the client’s retirement have on family members?

4. Review income and benefits considerations:

  • Is full-time retirement financially feasible?
  • How will changes in the economy affect the client’s pension?
  • What plans have been made for health insurance benefits?
  • How much income will the client’s investments and retirement benefits contribute to income?
  • What steps are necessary for the client to take to receive benefits?

5. Overall retirement planning:

  • What are the core factors for the client to enjoy a personally satisfying retirement?
  • What are the things the client values most?
  • If there is an unexpected financial or medical setback, is there a backup plan?
  • Do the overall plans meet the demands of personal, social, and financial changes?

Once clients have satisfactorily addressed relevant issues, they are considered ready to retire. However, completing the tasks doesn’t mean clients must retire, only that they are prepared to do so. Some clients will choose to continue working past retirement dates. Learn more about the benefits of postponing retirement here.

Digging through the pre-retirement questions may be emotionally challenging for clients. Advisors may find themselves intimately involved in some of the most significant and personal decisions of their clients’ lives. But, the value of the hard work is visible at the end of the process, when clients transition smoothly to fulfilling retirements.

Unfurling a successful retirement plans takes time and effort. Working with a Retirement Income Certified Professional® gives clients clarity around this major life change and increases the likelihood that they will enjoy a smooth transition. Download the guide, How the RICP® Helps Transform Advisors Into Retirement Income Planners, and learn how the Retirement Income Certified Professional® program helps advisors develop specialized knowledge in financial planning within the unique context of retirement to help clients attain the retirement lifestyle they desire.

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