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Beyond Cash: Your Pre-Retirement Checklist, Part 2


In Part 2 of our series, we look at the decisions you'll need to make and strategies you'll want to formulate as you approach retirement.

In Part 1 of our “Beyond Cash” retirement checklist, we looked at your plans for your practice, health insurance needs, and some lifestyle considerations. Here in part 2, we’ll tackle estate planning, insurance considerations, additional income sources, and one big factor that sneaks up on some retirees.

Develop a Withdrawal Strategy

How much you will withdraw from your retirement accounts depends on too many factors to list here. In fact, there are so many variables involved, it’s almost impossible to suggest a way to tackle withdrawals. But…some decisions will be made for you, like those associated with required minimum distributions. In short, by age 70 ½ (with some exceptions), you’ll need to start taking distributions from your tax-deferred retirement accounts, even if you’re still a working dentist. While you can still save, invest, and earn on the bulk of your retirement savings, amounts you must withdraw will start to impact the growth of your ongoing retirement investments. In a way, this requirement—in place because Uncle Sam can’t wait to get his taxes—can provide structure around what else you’ll take out and when. Talk to your financial advisor about distributions and finding a roadmap that’s right for you.

A Fresh Look at Insurance

A few years before you consider retiring, review all of your existing insurance policies, including life, property, casualty, practice, and liability insurance. Make sure you’re covered for what you need, of course, but this is also a good time to eliminate any kinds of insurance you may still be carrying but no longer need. Also, consider where you’ll turn to health insurance after you retire.

Consider All Income Sources

Planning too far in advance may limit how much you can estimate retirement from other income sources, most notably Social Security. But once you get within a few years of your retirement date, you should have a pretty clear picture of what you can expect to receive. Note that you’ll have to file for Social Security a few months before you start to receive benefits. Also take into account all other retirement savings, including any from individual retirement accounts, 403(b) plans, pension plans, and other income strategies, such as annuities or reverse mortgages. (In a future column, we’ll discuss the more favorable view of reverse mortgages from many financial experts.)

Estate Planning Decisions

This is another topic too large to cover for our purposes here, but the key is to make sure you have a will, living trust, or other legal documentation of how your assets will be distributed in the event that your retirement is cut shorter than you would like.

A Sneaky Consideration

No plans are set in stone, and this goes double for retirement. Many retirees are caught off guard when a changing family situation or an evolving viewpoint from a spouse, partner, or other family member suddenly changes and can impact your retirement. For example, what if you miss your practice too much and decide you want to continue to see patients part time? What kind of impact would this have on your also-retired partner?

While you can’t prepare for a sudden change of heart or living situation, you can make sure you initiate regular communication with all those who may be affected by your retirement decisions. These conversations can be all the difference.


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