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When you are one year from your anticipated retirement date you need to make an appointment with your financial adviser. In this meeting you will need to ask questions about what you to do over the next year to prepare for your retirement, about how your investments are performing and about your options in regards to retirement withdrawals. You don't have much time left to make adjustments or to prepare for the next phase in your life, so this meeting is an important one.
How Is My Retirement Investments Doing?
This question is probably the first question that you will ask your adviser. It is intended to provide you with an overview of how much money you will have to work with during your retirements. It is also a question that will help you to determine if you need to make adjustments to your retirement date.
When and Should I Shift My Investments to a Savings Account?
This question is a good one to ask your financial advisor. Some advisors will recommend that you start selling off your private investments and deposit the funds into a high yield savings account so that you have a firewall or nest egg that is liquid. These funds will be used to supplement retirement funds during the first two to five years of your retirement, or to cover added expenses that you may incur during the lead up to your retirement. However, you don't have to do this. Your adviser will be able to tell you if you need a firewall and how to set one up if you do.
What Accounts Should I Set Up?
As you approach your retirement you may want to set up new kinds of savings accounts to handle the required withdrawals from your retirement plans. A high yield savings account, a money market account or other forms of liquid money management accounts are good to use for the overflow of money that you may have during the early years of your retirement when you may work part time.
What Tax Issues Do I Need to Plan For?
At your meeting you need to go over what tax issues your investments and retirement plans will create. If you have taken early withdrawals from your retirement accounts you may have early withdrawal fees and penalties to pay for and to account for on your tax return. You will also need to learn how to account for the money you get from your various retirement accounts and annuities. If your tax situation will be very difficult your adviser may suggest that you work with a CPA at tax time.
When Can I Start Making Withdrawals?
The answer to this question is going to depend on your age and your retirement products. Your adviser will be able to tell you when you can and you have to take withdrawals from your retirement accounts. They may also set up a calendar of required withdrawals for your or help you set up an automatic withdrawal program for your accounts.
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