Retirement is, in many ways, a double-edged sword.  On the one hand, it’s oh-so-exciting to think about the final chapter of our lives, when we’ll finally have time to pursue our passions, whether that means starting a new business, traveling, or simply spending time with family.  On the other hand, it’s something that takes a lot of preparation.

These days, with the uncertainty surrounding Social Security, it’s your responsibility to make sure your finances are in shape before you walk out that office door for the last time.  That means estimating how much money you’re going to need, as well as figuring out how and where to invest for the best return.

This is the side that I tend to focus on the most, and for good reason.  It’s important to be prepared, financially, so you can sit back and fully enjoy those years.  After all, you deserve it.  But the other side is important, too, and in many cases, we forget to think about where – and how – we want to spend our golden years.

“Your money has to stretch, which is what many people are concerned about.  But what they aren’t concerned enough about is asking, ‘Where am I going to be that is going to stretch my

money the furthest, but also give me a lifestyle that I’m going to fall in love with?’” explains Barbara Corcoran, real estate guru and author of the new book “Nextville: Amazing Places to Live the Rest of Your Life.”

So if your retirement is coming sooner rather than later, here’s how to weigh your options while still keeping an eye on your wallet:

  • Do a little soul-searching.  How do you know whether your version of paradise is a tropical island or a small, sleepy town?  You need to take a step back and really think about what’s going to be a priority for you during those years.  Sure, a bungalow on the Atlantic sounds great, but once you get there, are you going to miss your family?  Are there opportunities to volunteer or take classes nearby?  “We spend probably about 40% of our waking hours in the pre-retirement p
    hase of our lives working, so you’re going to have a lot of time on your hands,” says Craig Venezia, author of “Buying a Second Home:  Income, Getaway or Retirement.  Think about how you want to fill those hours, and then make sure the location you’re considering compliments your interests. It makes sense to plan a few vacations in the area, so you can get a lay of the land and the people who live there, and make sure it’s a place where you feel comfortable growing old.
  • Plan for the long haul.  You may be spry now – I know plenty of people in their sixties who still run daily, and I plan to do the same when I get there – but don’t forget that you’re looking for a home, and a location, where you can age.  Sounds a bit depressing, but it doesn’t pay to put this out of mind.  Venezia says to think about things like whether you’ll really want a multi-level house when you’re in your eighties, or if the doorways are wide enough to accommodate a wheelchair, should you eventually need one.  “I’d say the biggest mistake people make is thinking about how they are right now instead of how they are going to be 10, 15 or 20 years from now.  Will the area and house support you as you age?  The last thing you want to do is have to move at 70.”

Other things to consider are whether or not there’s a good hospital nearby (a must) and if a public transportation system is available to step in during the later years when you may not be able to drive.

  • Take advantage of the current market.  “Right now we have a real estate miracle happening.  We not only have low prices, but we have cheap money, low interest rates, at the same time.  In the 40 years I’ve been doing this, I’ve never seen tho
  • se two things happen at once,” says Corcoran.  It’s a good time to buy, that’s for sure, but one caveat – you only want to buy now for later if you’re absolutely, positively sure that you know what you want, and you’re within about ten years of your retirement date.  Why?  Beca
    use not only could your needs and circumstances change drastically, but the area where you purchase could, too.  Given time, the small, quiet town you fell in love with could easily become a suburb full of strip malls.
  • Make your money last.  Life expectancies are going up, up, up, and that means your retirement could stretch for twenty or thirty years.  It puts the pressure on you to really buy something you can afford, in an area where the cost of living isn’t sky high.  It’ll help if you can spread the savings you’ve accumulated evenly over time, something that isn’t discussed nearly as much as the saving process itself.  A general rule of thumb is to withdraw no more than 4% of your savings each year, increasing the amount for inflation as needed.  This should get you safely through, but don’t rely on math entirely. Instead, pay attention to the returns you’re getting on your investments – in a time like this, when the stock market is taking a dip, you want to scale back on your spending a little to even things out.  The last thing you want to do is sell low.
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