For many people, retirement may seem like a far-off accomplishment, a glorious place that looms over a distant horizon. However, you might be in a position to close the gap and round the curve into retirement much sooner — in fact, as early as this year.
Unfortunately, retirement isn’t as easy as clocking out for the last time, waving at your office and heading to the beach for good. It’s a matter of careful planning and self-assessment. However, there are some clear signs that you’re ready to retire sooner rather than later, even if it means you’re ringing in the end of the year as a retiree.
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To help you know whether you’re ready to retire this year, GOBankingRates chatted with Lauren Garner, vice president of demand generation and partnerships at Ascent Funding, as well as Dennis Shirshikov, a finance professor at the City University of New York and head of growth at Summer.
According to these experts, here are some signs you’re financially ready to retire in 2024.
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You’ve Achieved Your Financial Milestones
Mortgage paid off? Check. All debts settled? Double check. Reached your retirement savings goal? Triple check.
If you can check all the boxes on your financial goals, like paying off major debts and ensuring that your retirement savings are in a healthy place, Garner said you have taken a huge step toward being able to retire within the year.
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You Have a Robust Portfolio
According to Shirshikov, one of the clearest signs that you’re ready to retire is that you have a robust and well-diversified retirement portfolio.
“This typically means having enough savings to cover at least 25-30 years of living expenses, assuming a conservative withdrawal rate of 3%-4%,” he explained.
You’ve Factored In Social Security and Retirement Income
Social Security is a key part of many people’s retirement plans, so you need to calculate your Social Security benefits and factor them into other income, like a pension, per Garner.
You’ve Assessed the Market — and Your Finances
“For those looking to retire by the end of this year, conducting a thorough financial assessment is the first step,” Shirshikov said. “This includes evaluating current savings, projected expenses and any potential income streams.”
He added that ensuring your investment portfolio is balanced enough to mitigate risks associated with market volatility is another essential goal. If you shift toward more conservative investments, you might be better able to protect your nest egg while still allowing your money to grow.
Part of bolstering yourself for retirement involves maximizing your contributions to retirement accounts, like 401(k)s and IRAs, before the year’s end to give yourself significant tax benefits and increase your retirement savings.
You Have a Plan for Healthcare
If there’s one downside to retirement, it’s that it represents a time in life when you may end up needing more healthcare. Shirshikov said that with healthcare costs rising, you have to make sure that you have coverage that will last you through retirement. This may involve a combination of Medicare, supplemental insurance and long-term care insurance.
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This article originally appeared on GOBankingRates.com: I’m a Financial Expert: 5 Signs You’re Financially Ready for Retirement in 2024
