5 Retirement Moves You Need to Make in Your Last Work Year
Retirement may be like rounding the final lap, but it definitely isn’t the end. If you have a positive approach, you will take it as the start of something new. But before you trade in your office chair for a beach lounger or your morning commute for morning coffee on the porch, there are some key moves to make. This last year of work is your opportunity to get laser-focused on your future.
The key is to fine-tune your finances and update paperwork to envision how you’ll actually spend your days post-retirement. Let’s learn all these techniques before it’s too late.
Treat Your Retirement Accounts Like a Final Project
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Your retirement should be treated like a financial spring cleaning. Open every account and check your balances, investments, and how risky your portfolio really is. If your accounts are scattered, consider consolidating for your own ease. Managing fewer accounts means less stress later when you’re living off what you’ve built.
Catch-Up Contributions Are Your Late-Game Advantage
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If you’re 50 or older, the IRS lets you contribute more than younger workers. In 2025, you can put in up to $31,000 to your 401(k) and $8,000 to your IRA. That extra space is valuable. Max it out while you still have regular income.
Budgeting Isn’t About Deprivation
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Forget spreadsheets for a second. This is about knowing what your future lifestyle actually costs. Start with your fixed expenses, then add things you’re excited about—like travel or hobbies. See how your savings line up. This approach is peace of mind in numbers.
Healthcare Doesn’t Retire Just Because You Do
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If you’re under 65, you’ll need to bridge the gap before Medicare kicks in. COBRA or marketplace plans are your main options. If you’re already 65, Medicare begins, but it has layers and costs. Learn what each part covers so you’re not scrambling when coverage matters most.
Don’t Wing It with Social Security
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Sure, you can start claiming at 62. But you’ll get less—maybe a lot less. If you wait until 70, your checks could be nearly 80% higher. Use the Social Security calculator, and think about your health, your income needs, and what gives you the most long-term security.
Kill the Debt Before It Follows You Into Retirement
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Debt is a budget killer when you’re on a fixed income. Start knocking it down now, especially anything with high interest. Credit cards and personal loans are priority targets. Even small extra payments can make a big difference once you’re no longer collecting a paycheck.
RMDs Are Mandatory. And Missing Them Costs You
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At 73, the IRS requires you to start withdrawing from most retirement accounts. Skip it, and you could face a steep penalty—up to 25%. Figure out how much you’ll need to take and when. Planning your withdrawals now keeps things smooth and penalty-free later.
Your House Might Be a Home or a Headache
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Ask yourself if your current home fits your retirement plans. Maybe you want less space, fewer stairs, or lower property taxes. Downsizing could cut expenses and unlock extra cash. Or maybe you just want a warmer zip code. Either way, now’s the time to decide.
Update Your Legal Docs Before You Actually Need Them
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Check your will and review your power of attorney. Make sure your healthcare directive reflects your current wishes. It’s not just about end-of-life planning but also about giving your family clarity. These documents speak for you when you can’t. Don’t wait until there’s an emergency to realize they’re outdated.
Long-Term Care Is Expensive—and Often Unavoidable
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Most retirees will need long-term care at some point, and it’s important to realize that the costs are high. A private room in a nursing home can top $100,000 a year. Look into insurance or hybrid policies that include coverage.
An Emergency Fund Still Matters
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Even in retirement, life throws surprises. Roof repairs, health scares, or just helping out adult kids. Keep three to six months of expenses in an easy-to-access account. A high-yield savings account is ideal. This way, you’re not pulling from long-term investments every time something breaks.
Retirement Income Isn’t All Tax-Free
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Don’t assume you’re done with taxes after retirement. Withdrawals from traditional IRAs and 401(k)s are taxable. Even part of your Social Security might be taxed depending on your total income. Talk to a financial pro to build a tax-efficient withdrawal plan that helps you keep more of your money.
Time to Cut the Clutter
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Old 401(k)s, random saving accounts, and multiple brokers can all add up, and not in a good way. Streamlining your accounts makes it easier to manage your money and spot issues early. Bonus: It makes life easier for your spouse or heirs if anything ever happens to you.
A Financial Pro Can Fill in the Gaps
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Even if you’ve done everything right, a second opinion helps. A certified financial planner can spot things you missed and help you fine-tune your strategy. Choose one with fiduciary responsibility so their advice puts you first.