There’s a time for everything. One day, you’re at the top of your game being an entrepreneur and running your business. On the next, it’s time for your retirement already. Retirement doesn’t have to stop you or impede your progress. With certain preparations in place, you can still maximise your time even if you’re already retired.
If you’re planning to retire soon, here’s a guide to ensure you’re ahead of the game.
1. Estate planning
When you’re retiring, planning ahead includes estate planning. Estate planning is the process of executing papers and documents in anticipation of incapacitation. This will ensure that your assets will be bequeathed to the right people. You can assign your house, stocks, paintings, cash, and even debt to specific individuals. In case something happens to you, you’ll have peace of mind that your belongings and assets will go to the people you’ve assigned them to.
Another advantage of estate planning is it takes estate tax off the shoulders of your heirs. Estate tax can be a bit hefty, so estate planning will also be useful for the people you leave behind. As you make your estate plan, you’ll usually need the help of a lawyer who’s experienced in estate law. An experienced and reliable lawyer from firms like Nevis LLC can help to guide you through the whole process, so you can avoid making any costly mistakes.
2. Succession planning
Your business doesn’t have to go under when you retire. As an entrepreneur, succession planning is critical to make sure your business will still be operational even when you’re not leading it or working there anymore. Craft a strategy to pass on the torch to a family member or a trusted, reliable officer. Doing this will ensure continuity even if you’re going on retirement.
Succession planning doesn’t happen overnight. You need to sit on this and think about who can take your place. Once you’ve set your sight on the right people, you need to make a plan to groom these people for the positions they’ll take up in the future. For the one who’s going to take your place, you might need to do direct mentoring and guidance. Start reviewing your plans and make the necessary organizational changes for your succession planning as soon as possible.
3. Savings and investments
Another matter that you need to set up is an adequate amount of savings. As a rule of thumb, it’s best to keep a percentage equivalent to the difference between your age and 100. To illustrate, if you are 40 years old, it’s highly recommended to keep 60% of what you earn as savings in the bank. Then, set a goal amount you need when you retire.
On top of having enough savings, you also need to invest your money before you retire. Because of inflation, the value of money tends to decrease. To counter this, you need to invest your money in stocks, bonds, or real estate. These investment channels can provide you with passive income when you’re no longer working. Stocks can give you passive income in the form of dividends. On the other hand, you can lease or rent out real estate and earn from the rental income you get from your tenants.
Remember that when you’re retired, you’re also unemployed. This is where your pension kicks in. Retirement benefits through pensions can be your source of income after you retire. Your pension is what you can use to pay off your monthly living expenses. That’s why you need to do necessary preparations for your pension as well.
5. Health insurance
As they say, health is wealth. When you grow older, it’s easier for you to come across unexpected illnesses and complications. Without a stable source of income, hospital bills can be a bit heavy for you when you’re already retired. In preparation for this, you should also get health insurance for yourself well before you decide to enjoy your retirement.
Health insurance is very much different from life insurance. This type of insurance will cover your hospital expenses. While you are young, the premiums you have to pay for health insurance are less expensive. So, the earlier you get one, the better.
After being a successful entrepreneur, the next stage in life is to retire. Even if you love your job as an entrepreneur, there’s always an end to things. Start your retirement strong. Have your estate and succession plans in place, so when the time comes, you’ll have robust financials that can still support you even if you’re not running a company anymore.