Step #1: Complete a personal financial statement to understand how your assets are invested.
Step #2: Understand your medical coverage options (COBRA, Marketplace, and Medicare).
Step #3: Timely Medicare election on your 65th birthday (three months before or after). Knowing your Part A (Hospital), B (Outpatient) and D (Drugs) coverage options and costs are critical.
Step #4: Know your retirement income sources and Social Security benefit options (www.SSA.gov).
Step #5: Create a realistic monthly expense budget
and track your actual living expenses.
Step #6: Plan ahead for all major expenses (Car, home repairs, vacations, etc.).
Step #7: Create a Cash Flow Plan to know your monthly cash shortfall (Income minus expenses).
Step #8: Utilize the 5% Distribution Rule. Historically a diversified portfolio can distribute 5% each year. If this amount is not enough, you need to increase income,
lower expenses, work longer, or save more.
Step #9: Understand your federal marginal tax rate. This allows you to maximize the lower marginal tax brackets through annual IRA withdrawals or Roth conversions.
