Retiring During a Pandemic: What do I do?

Contributors

f you are one of many people nearing retirement or in the process of retiring, you may be filled with mixed emotions. On the one hand, after many years of hard work, you have now reached that moment when you hopefully can take a breath and enjoy whatever it is that brings you fulfillment in your life. However, you may also be hesitant, maybe even wondering if now is the right time. And, of course, this is a natural feeling for such a landmark event. We get that. In fact, we also understand that in many cases, retirement or an employment transition may not even be a choice, but something decided for you as companies around the country downsize to manage the challenges of a weak economy and uncertain future.

Indeed, as we throw in a global pandemic that has forced many of us to work from home, distance ourselves from family, friends and coworkers, this may not be the exact picture of retirement or change in employment that you had planned and hoped for.

Fortunately, there are many resources and professionals available to support you during this stage of your life – however you got here – and help create a framework for what comes next.

Of course, when it comes to your investment savings, one potential benefit of working with a financial advisor at this time is to support you in managing not only your investments, but also your cashflow and overall financial planning. Once you fully retire and are no longer in an “accumulation” stage of your life, you may find that working with a financial professional to support your long-term goals can be reassuring. A financial advisor can help create a plan for how to manage this newly entered “distribution” phase, where you are no longer contributing to your retirement accounts, but now, like many people, you may in fact be taking distributions to maintain your lifestyle.

Which brings us to the next topic – your retirement accounts. You may also be wondering what to do with your retirement assets that are held with your current employer. Whether you have a 401(k), 403(b), pension plan, SIMPLE or SEP IRA, you may have a few different options based upon your unique situation, personal values and goals.

Some employers may allow you to leave your retirement account where it currently is – and if you are comfortable doing so, you can continue to monitor your investments as you have been.

A secondary option you may have is to transfer your employer sponsored account into an individual retirement account, “IRA”. This is referred to as a direct rollover. You may choose to self-manage your account and select your own investments, just as you did within your 401(k).

On the other hand, you may well consider directly transferring your account into an IRA with a financial advisor to manage your portfolio on your behalf. Many people find this option beneficial so they can enjoy retirement in the way they imagined – leaving the financial planning and wealth management to a professional.

If you are approaching retirement and would like to compares notes about your options, we are happy to help support this major decision in your life based on your personal situation and set of circumstances. Ultimately, there are many factors to consider when thinking about moving away from your employer sponsored retirement plan, such as costs and additional services you may receive by working with a trusted advisory team. We believe it is prudent to consider your individual situation and what may work best for you. We do realize, given the times we are in, employment transitions and yes, retirement, are subjects to evaluate with great care. With that thought in mind, we are happy to compare notes when you are ready.