It has been 6 & 3/4 months since retirement, and I no longer practice retirement, just do it. Above, last Sunday, exercise walk/hike with Elaine, Cindy & Bogey at Fremont Older.

Had a nice short talk with younger sister Tence (sister #7). Talked a bit about retirement. So, thought I would write about the process I followed to prepare and make the decision for when/date to start enjoying retirement. Living should get easier and fun like when we were kids. This can only happen if you plan to make it so, otherwise ...

First, if your company offers a pension, project your monthly payment at 55, 57, 59, 62, 65 yrs. of age, using their pension calculator with reasonable assumptions. This becomes asset #1.

Second, if you you have a 401K, deposit the full amount allowed even beyond the company match. Then understand the return (percent growth) of the investment options you have currently selected. Then study/compare with the other investment options available/offered with your 401K. Look at the 3 mo., 6 mo., 1, 3 and 5 yr. returns of the various investment options. Then choose three or four of the best performers and divide equally your current 401K $ to each of this stocks. Remember, it is return on investment for the long term. Then monitor on a monthly, or quarterly for at least one year. Then if you like the results, go another year, or redo the study of the options and make new investment selections. Then make reasonable projections for the net 401K $ for the same ages as above. Then figure how much you can withdraw monthly to make the 401K $ last 25 yrs. This will become asset #2.

Social Security probably already sends you yearly what you can expect monthly from SS at various ages. This is asset #3. At least by 50 you should be getting them, if not earlier.

Third, understand your monthly expenses/liabilities, that is, how do you spend your current assets/income. I use Quicken (about $60), there are probably other applications available. it allows you to download checking, savings accounts, credit card expenditures, and some institutions allow 401K downloads. Download monthly for at least a year. This application allows you to categories all your expenses. The first time takes the longest, then it automatically tracks your expenditures by categories for every month. You can then generate various reports showing expenses/liabilities by categories by month. This shows your current monthly $ expenditure habits and compares with monthly incomes. Why do this? This will give you an indication of how much income you will need at retirement to maintain your current standard of living.

Fourth, the application can compare your current average monthly expenses/liabilities with your projected retirement income/assets. You then can start controlling your expenses/liabilities to match your retirement income/assets at various retirement ages. The Quicken application can show you your fixed and variable liabilities. Fixed liabilities are things like mortgage split into interest and principal payments, car expenditures such as monthly fuel, maintenance, insurance, and registration, taxes and many others. There is also a list of variable liability categories, groceries, dining, ATM cash, recreation, household, medical, credit cards and others.

Fifth and very important, practice retirement for at least one year. For this, the application allows you to create a monthly budget based on your projected retirement income/assets. Practice reducing your monthly expenses/liabilities, first focus on reducing the variable liabilities, practice till your projected monthly retirement matches your retirement income/assets as closed as possible. Practice the standard of living you can/will hold with your retirement income/assets. Pay off/eliminate before retirement as many variable expenses as possible such as those credit cards, they are killers.

Sixth and also very important, have a plan for things to do with your time. Long term and short term activities. All for fun. Also very important, be flexible, changes in life are unpredictable, if you need to work part time during the initial retirement years, then so it is and you still have time to have fun. Working part time could make work be fun.

By now with the above, you can see a road map and effort/planning for what it will take to determine when you can retire. Believe me, it is worth the effort. Can you retire at 55 or 57 or 60 or ..... The effort can results in allowing you to retire as young as possible with a reasonable standard of living. Otherwise your retirement age will be some default age and perhaps not in your best interest. I would guess, this usually occurs if you don't have a pension and/or 401K $ nest and/or to lazy to plan. The sooner you follow a road map and effort to plan your retirement date, the more realistic and more confidence you will have with the date you choose, and the standard of living you can enjoy retirement with, for the longest time possible. We all “kick the bucket” sooner or later, and later is better.

I followed the above road map and the $ numbers said at 57 would work for me. I retired about 5 days before my 57th birthday (last work day of May 07). So far so good.