The Tribune

MANY employees are making the mistake of taking too long to prepare for retirement. After working diligently for more than 30 years, you should set yourself up financially for your golden years. The last 12 months before you call it ‘a day’ are especially critical to putting your retirement on a prosperous path. It is time to get your portfolio, health care and other finances in order so you can enjoy your new life. Here is short checklist of what each employee can do to prepare for the inevitable.

Raise cash: Your pay cheques are about to stop. Many persons look seriously at moving money otherwise invested into a savings or money market account to fund at least one year of expenses. Retirement time is not the best time to be financially poor and rich in investments. Ensure you have access to a certain amount of cash at all times.

Set a realistic retirement budget: There are a number of instruments financial planners use to help soon-to-be retirees list all of their fixed and discretionary expenses.

This tool gives you a clearer understanding on how lavishly you can live for the length of time you expect to live post-retirement, given the smaller streams of income you will have remaining.

Play out Social Security scenarios: Bahamians need to be reminded that National Insurance Board (NIB) benefits are not designed to be the single survival item in your retirement portfolio. The small assistance given is designed merely to supplement the four or five other savings and investments streams that should be working for you even now.

Figure out how you will pay for health care: Check if your company offers retirees medical, long-term care and other insurance coverage. Make up your mind regarding how you will maintain your health care coverage, which could easily be a sizeable chunk of your retirement budget. Research has proven that the single most financially challenging expense for retirees is the cost of healthcare. This must not be taken lightly.

Manage your physical and emotional well-being: Knowing your health status is crucial as you prepare to exit the workplace. The removal from the fast paced day to day may require a change in physical and mental activity schedule that becomes the new order of the day. Staying fit, agile and active must become routine for the employee pre and post retirement.

Create a strong social network: Work becomes more than our careers and earning a salary at the end of the day. This represents, for many of us, the extended family. Separation from people we know, love and have experienced life with can be heart-wrenching. It is important that all pre-retirees find themselves in community, church and other civic groupings to rebuild networks during the transition from work.

Retirement planning is no longer something we consider five years before it actually happens.

This has, in many companies, become part of the onboarding orientation conversation. The longer we have to prepare, the larger the net we can build to ensure these years are comfortable and well lived. Happy planning.

• NB: Ian R. Ferguson is a talent management and organisational development consultant, having completed graduate studies with regional and international universities. He has served organsations, both locally and globally, providing relevant solutions to their business growth and development issues. He may be contacted at tcconsultants@coralwave.com