We are in the final days of 2017 and for some that means closer than ever to retirement! After working 40-plus years, if not even longer, upcoming retirees should look forward to spending the latter years of their lives doing what they love in retirement.
In some situations, being able to earn income following retirement is instrumental in achieving a safe, happy, stress-free post-working life. As the whole point of retiring is to abstain from the day-to-day grind, retirees may find that one or more passive, part-time income streams helps to fund their post-working lives.
Let’s look into some of the best practices for planning one’s life after working full-time for however-many years.
Bulking up your IRAs
Thanks to an environment in the United States of America that is friendly towards current and upcoming retirees, everyone older than 50 years of age can stow away larger values than normal into their IRAs. Specifically, these persons can add a maximum of $6,000 per year into 401(k), 457(b), 403(b), and other IRAs. Keep in mind the $6,000 is a sum of what can be added throughout all of one’s IRAs, not $6,000 per individual account.
If you are planning on retiring sometime within the next 14 months – at any point from November of 2017 to December 31st, 2018 – it may be wise to contribute this $6,000 sum into whichever IRA that will prove most beneficial for your post-working finances.
It’s OK to place retiring on the back burner
If you’re not comfortable with the amount of money and employment benefits you have to retire, consider working longer. In the event you’re more than ready to leave your current job, consider picking up another career outside of the industry you’ll soon be leaving. Most retirees can find something enjoyable to occupy their time, so why not earn money while doing so?
Dates most prudent to retire on in 2018
According to the CSRS, Civil Service Retiring System, you should retire on the first, second, or third of any month throughout 2018. This plan allows people to retire and be formally recognized as doing such the following day.
Throughout the first half of 2018, check online for most dates in the latter half of next year, or in future years. The best dates to retire in concordance with the CSRS are as follows:
- January – 3rd
- February – 2nd
- March – 2nd, 31st
- April – 3rd
- May – 3rd
- June 1st, 30th
The Federal Employees Retiring System, often shortened to FERS, allows retirees to best structure the commencement of their federal benefits when retiring. If you retire on any day of a month – let’s assume that month is March, for example – in this case, March 17th, your federal benefits commence on April 1st.
The April 1st commencement holds true for federal employees that formally stop working on March 1st, 3rd, 22nd, 30th, or any other date within the month of March.
As far as the best plan for getting the most from FERS is concerned, formally stamp your retiree card on the last day of a month, even if it falls on a weekend.
We understand that planning for retirement can be overwhelming for some while exciting for others. Either way, pre-retirees can have a lot of questions. We are here to answer those questions to be sure you are prepared for the retirement road ahead.