“As you reach your desired retirement age, you must make decisions about how to enjoy what is yet to come.”
Part 3: the moment has arrived A s you wind down your journey to retirement, hopefully all of your planning and hard work has come to fruition and you successfully attained your goals. I am sure there has been turbulence during the journey, as that is the norm and not the exception. Emotionally, it is very difficult to retire. Your relationships with your staff and patients wind down and, in many cases, completely disappear. As professionals, dentistry is more than a job — it is your passion. It is important that you recognize there will be a feeling of loss, and that is normal. Hopefully, you will replace it with new joys and excitement. As you reach your desired retirement age, you must make decisions about how to enjoy what is yet to come. Each of you has chosen a retirement age that is ideal for you. For example, I will pick the age of 64. Your first decision is what you will do for healthcare. This is an important decision, as you will not qualify for Medicare until the age of 65. If you are fully retired, then you will have to find a private insurance policy that will cover you until the age of 65. This can be not only problematic, but also expensive, as
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you are no longer in a group policy. For some, it may be difficult to afford a new policy if you have preexisting conditions, and this may affect your decision to wait until 65 to retire. The next decision is what to do if you did not accomplish the retirement number that you have been working toward. Perhaps you delayed saving later than you should have, or perhaps you didn’t maximize your plan contribution each year. Maybe the market was unkind or your adviser didn’t perform well. Whatever the reason, there is a likelihood — and I speak from experience in working with dentists — that you are short of your desired goal. You are now faced with a dilemma. Do you accept a lower retirement plan amount, which is acceptable if all of your other retirement income goals are good, or do you work longer to save more? Working longer is definitely acceptable, as your desired retirement age was a benchmark and not an absolute. If working a few more years will help you reach the goal you desire, it is not the end of the world. It is only difficult if your health is poor. One should eliminate as many loans and debts as possible before entering retirement.
Your goal is to try and reduce as much drag on resources as possible. In the personal world as well as the business world, debt is a large anvil weighing down performance and preventing one from reaching goals. Interest payments reduce income needed to live on and the ability to reach your savings goals. Social Security is another issue. If your normal retirement age is 67 (as defined by the Social Security Administration), and you take your Social Security at 64, then you will receive a reduced amount from your normal retirement amount. This reduced amount will last for the rest of your life. This is not a problem if it is accounted for and the reduction in income is acceptable. I am often asked at what age someone should take Social Security. My answer is that you take it when you need it — not before. The longer you wait before taking it provides you with a higher monthly income. The only absolute reason to take it early is that it is a necessity to exist or your health is poor. The great thing about Social Security is that it is your only income source in retirement that is indexed for inflation. All of your other sources have to be adjusted manually.