10 steps to take as you get ready to retire

STEP 4: CREATE A RETIREMENT BUDGET Your budget should include: * How much money is coming in. * How much it will cost to reach the goals you identified in step 1. * How much debt you have. 

Start by tracking your income and expenses for a couple of months. Next, figure out how much money you’ll need to support your chosen lifestyle in retirement. (The AARP Retirement Calculator

 can help.) You’ll also want to do a checkup on your investments (Is your portfolio diverse? Are you paying a ton in fees?) and make sure your budget accounts for paying down debt. A general

rule of thumb is you’ll need 80 percent of your working income in retirement to maintain your standard of living. Social Security is only intended to replace about 40 percent of the average

retiree’s work earnings, so you’ll need to build income sources beyond your benefits. Think about ways you can drum up more money, such as getting a part-time job, selling some of your

things or downsizing to a smaller home. Keep in mind that the 80 percent threshold may not account for spending on extras like travel or hobbies, and that discretionary spending tends to be

higher in the early years of retirement when you are more likely to be healthy and still raring to go. STEP 5: DETERMINE WHEN TO START SOCIAL SECURITY For many older adults, this is the most

important decision they’ll make about their retirement finances. About 1 in 3 Americans age 65 and older rely on Social Security for at least 75 percent of their income, according to a 2021

Social Security Administration study. The age at which you choose to claim retirement benefits will have a direct impact on how much you’ll get each month. The longer you wait to start

collecting Social Security (up to age 70), the bigger the benefit for you and your family. How much bigger? You don’t qualify for 100 percent of the benefit calculated from your lifetime

earnings history until you reach full retirement age (currently between 66 and 67, depending on year of birth). If you claim earlier — the minimum age is 62 — you get between 70 percent and

99 percent of your benefit amount. If you can wait past full retirement age, you’ll be eligible for delayed retirement credits, which increase your benefit for each month until you reach age

70. Whether you are married, single, widowed or divorced, it usually pays to put off claiming. STEP 6: DECIDE IF YOU WANT (OR NEED) TO WORK People 65 and over are the fastest-growing age

group in the labor force, according to the U.S. Bureau of Labor Statistics. For many older workers, it’s a classic cost-benefit equation: Unless you are financially set for life, you will

have to either stretch limited money or stay in the workforce in some capacity to help pay for your retirement dreams. So, as you work out your retirement goals, take into consideration

whether, and how much, you’ll need to work. Don’t wait until you retire to make the decision. Take time now to weigh pros and cons of continuing to work: Full-time, part-time or freelance?

Stick with your career or try something new? The sooner you get comfortable with your choices and what they could mean financially, the more secure you will be in your retirement planning.