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4 must-do’s before you retire

By Jennie L. Phipps ·
Friday, January 25, 2013
Posted: 3 pm ET

Before you hang up your work boots and walk out the door, use this retirement planning checklist, prepared with help from Allianz Life, to make sure you haven't left anything more important than ballpoint pens in your cubicle.

Start by scheduling an appointment with your human resources department. The person you talk to may have a list of topics she wants to cover, but don't let her forget to answer all your questions about these four topics. It is also a good idea to get expert help from other sources as well.

Claim your old-fashioned defined benefit pension. If you're lucky enough to have one of these, be sure you understand when and how you can claim benefits and how much you are entitled to. Most pension providers offer between four and 10 ways to take your pension. You'll have to study these options and decide which is best for you. Don't delay this review past age 65. Few pension plans offer any incentive for waiting to take the money until you are older than 65.

Pack up your 401(k). Don't cash it out -- that will leave you with an enormous tax bill.  Do consider rolling it over into an IRA, so you can have more options to manage it than you'd have if you were limited to those offered by your 401(k) plan provider. You also might decide that putting part of your 401(k) in an annuity that will provide a steady check for as long as you live is a comforting idea. But before you do anything irrevocable, get some good financial advice. This chunk of retirement savings has to last you a long time.

Figure out who's paying your health care. If you're lucky enough to be offered retiree medical insurance, sign up for that first. In any case, if you're 65 and old enough for Medicare but you've been covered by group health insurance, this coverage will likely end when you retire. After that, you'll have an eight-month special enrollment period to sign up for Medicare Part B without penalty. If you're not old enough for Medicare, then under most circumstances, you can continue to be covered by your employer's health insurance by signing up for 18 months of COBRA, or the Consolidated Omnibus Budget Reconciliation Act.

Decide on a Social Security strategy. If you aren't yet 66 and you claim Social Security in the year you retire, the wages you earn from a job may interfere with your Social Security benefit. Someone age 62 through 65 can earn up to $15,120 in 2013 with no effect on their benefit. After that your Social Security will be reduced by $1 for every $2 you earn. Retirees who turn 66 in 2013 are limited to earning $40,080. After that, $1 of every $3 of your Social Security benefit will be withheld. Figure out the impact of these rules before you start receiving benefits, or you could have a nasty surprise when Social Security demands that you repay any overpayment.

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March 05, 2013 at 11:19 am

For more on retirement and finance, health, jobs, retirement locations.... check out

February 09, 2013 at 3:38 pm

Wow, this article is seriously misleading.

It needs to say, clearly and prominently: wages earned AFTER you reach full retirement age do not reduce your social security benefits at all.

jim tate
January 28, 2013 at 11:15 pm

i am fortunate to have both social security and a defined benefit pension, the total income is slightly less that what i was earning, so i am able to get by without worry. As for a 403(b), 401(k) or other investment strategy....use caution here. I invested most of my working life, at times to the max, i was on the way to a great nest egg when the market collapsed about 12 years ago. I lost 2/3 value of my account and it never fully recovered. Additionally when i take money from the account my tax rate is much higher than when i put it in....I would have been money ahead to use a Roth IRA as much as possible and sensible after tax investing with the rest.

Chris S
January 28, 2013 at 9:50 pm

I can't stand these clueless 'experts' like Jennie who give totally wrong and harmful advice. After full retirement age there is no earnings limit. Correct your blog before people make completely incorrect decisions about retirement.

Another thing all of them get wrong is the advice to delay taking social security as long as possible. If you are entitled to $1,500 a month at retirement age you can start receiving it and put it in the bank and after one year you have a $18,000 (minus taxes) nest egg, 36,000 after 2 years and so on. It will be 15 to 20 years before the payments at the higher monthly amounts taken starting at age 70 eventually equal what you would have accumulated in the intervening years.

Paul Sevald
January 28, 2013 at 8:03 pm

Tom Wolf obviously has some serious anger issues. Did he live within his means during his working life? Save 15% of his salary? Drive a car for 10 years or did he have to get a new one every 2 years? It certainly sounds like he made some bad decisions in his life, we all make our own bed and have to lay in it.. stop blaming the " rich" for all your problems... this is the greatest country in the world still and with that attitude you probably deserve were you are...

January 28, 2013 at 7:30 pm

Please vote as to which bumper sticker I should have made: Vic of predatory capitalism or Morality can not be legislated?

Tom Wolf
January 28, 2013 at 2:03 pm

Retirement, at least the kind of one we were led to look forward to after working our entire lives, is rapidly becoming a fantasy that is increasingly reserved for only the rich.
Pensions are stolen by former (and present) employers to pay executive bonuses and golden parachutes to the predators in the board room.
Salaries and benefits are cut, forcing people to work long after we planned - that is, if we are not replaced by minimum-wage temps and offshore slaves.
Sacrifice is called for on the part of the very workers who have produced the obscene profits that have all been sucked up the food chain.
If it was not so tragic for most people, it would almost be funny.
Like the old Steve Martin joke, the first step to "living like a millionaire" is to "get a million dollars" without any realistic hope of doing so.
That option has been shut off for most.
The advice given by those catering to the rich ignores the realities that so many will not be able to survive, especially in the face of reduction or elimination of social programs like Social Security and Medicare that for the most part we have paid into our entire working lives.
The view is that "if you need help to survive, you messed up and should not look to the "successful" to lend a hand (even at usurous interest rates).
Welcome to feudal Amerika - the goal and ultimate result of unfettered, predatory capitalism.

Lloyd Perrault
January 28, 2013 at 12:20 pm

Get your facts right! The article implies that your Social security benefits are limited if you exceed $40,080 in the year that you reach full retirement age. This is not true. you are only limited by income received BEFORE the month you hit your retirement age - not the whole year. The following came from the website:
In the year you reach full retirement age, we deduct $1 in benefits for every $3 you earn above a different limit, but we only count earnings before the month you reach your full retirement age.

If you will reach full retirement age in 2013, the limit on your earnings for the months before full retirement age is $40,080. (If you were born in 1947 or 1948, your full retirement age is 66 years.)

Starting with the month you reach full retirement age, you can get your benefits with no limit on your earnings.

Maria Ofelia David Capati
January 26, 2013 at 4:09 pm

If you've two pensions i.e., social security and your company's defined benefit pension program, you don't even need to dig into your 401k or IRA (conversion). Leave the IRA nest except for the Required Minimum Distribution rule every calendar year. Don't get too ambitious or too gready. Be a Moderate/Moderate Investor to protect your investment. It's one way of leaving something to your favorite grandchild or grandchildren when you go.