We are asked that question frequently. Sometimes, it comes from those who have saved little to nothing for the future. Occasionally, it comes from those who are seeking investment advice about how to manage their savings and investments. Today, we are offering thoughts on what those in their 60’s should be thinking about and doing to plan for the future.

The most important question for someone 60+ does not focus on finances at all. A family in their 60’s needs to answer this question more than any other: What do we want to do when it is time to change gears?One of the worst places to be in life is to have change forced upon you with no idea of what you want to do next! Let’s face it, while we may have honestly never wanted to retire, there is a time coming when change will be unavoidable. Whether it comes due to someone’s health, or some other reason, we all reach a point when maintaining our current full-time role is not possible.

Every family in their 60’s needs to have a serious discussion about what they want to do next. Do we want to travel? Do we want to continue working somewhere else? Do we want to spend more time with family? Is there a ministry or non-profit in which we have a distinct personal interest where we could serve in a volunteer or part-time role? Would it be possible to continue with our present employer, church, or ministry in some other role? Husbands and wives need to answer these questions privately…and then discuss these ideas together. Please talk about this at some length. Come to a mutual agreement about the future and commit this plan to writing!

We also need to consider, Where do we want to live when we change gears? While there are elements of this question involved in the first, it deserves an entirely separate conversation. Does what we want to do in the years ahead require us to relocate? If one of our major goals is to spend time with family, we may need to relocate. How do we handle relocation if our family is widely dispersed? Should we move closer to one part of the family, or should we live as close to the middle as possible? If we decide to move closer to our children in retirement, will the healthcare senior citizens need be available? If we decide to relocate closer to children, what will happen if they subsequently decide to relocate for their career or ministry? Should we decide to downsize, or is the family home a part of our emotional makeup? Relocation is sometimes attractive and can provide opportunities for downsizing. There are also potential pitfalls that must be weighed carefully.

How much will we NEED to spend in our retirement years? This question is often considered in general terms. We can find advisors who have suggested people should budget for spending 75%-80% of normal current expenses in the future. We can also find many prognosticators who advise people they will spend exactly the same as they are spending now. This is a question that needs to be addressed by both husband and wife in specific, not general, terms. An underlying question for discussion is, “How much can we reduce our spending in retirement?” Will the current homeplace need repairs? Families need specific answers about how old is the roof, the heating and air conditioning, the lawn mower, the exterior paint, and more? When will we need a new vehicle? Can we save on life insurance premiums? Is it wise to do so? How much are we willing to reduce the budget for gifts to the family? If a goal is to travel, how much will proposed trips cost? If one, or both of us, needs long term health care, how will we pay for that service? Can we identify WANTS that can be trimmed in order to reduce expenses?

One of the issues that arises as we look at how much we will need to spend in retirement is, “How can we aggressively reduce expenses now – before that change happens?” Can we pay off the home loan now? Would it make sense to refinance now? If we are not in the habit of paying off all credit card charges each month, now is the time to do so! Reducing spending while we are still working full time is a good habit that will serve the future needs well.

There are many questions to consider that cannot be covered at one time. The point we want to make is that hard core planning needs to begin BEFORE the time of retirement. Anyone in their early 60’s needs to begin making those plans now. Unless we are currently facing a life-threatening illness, we need to plan for a retirement of 25 years or more. Twenty-five years does not sound long when one has well more than that in the rear-view mirror, but the last thing we want anyone to do is run out of money.

A well done, enjoyable retirement is seldom the result of careless cooking. However, if a family follows a thoughtfully prepared recipe, the result can be years spent pursuing your passions!