The end of any given calendar year can be an exciting time if you're someone who enjoys the holiday season. But if you're planning to retire in 2026, the next few weeks may be even more exciting if they represent the final countdown toward the end of your career.
You might think you're ready to retire, and you've hopefully does a fair amount of planning to gear up for that transition. But before you make your 2026 retirement official, here are three things you should make sure to do first.
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1. Figure out what you'll do for healthcare
Going without health insurance at any point in life is a huge mistake. One emergency room or hospital bill could result in catastrophic costs.
But it's an especially bad idea to go without health insurance if you're older, as health problems tend to arise with age. So before you kick off your retirement, make sure you have a plan for getting health coverage.
If you'll be 65 at the time of your retirement, you'll be able to get covered through Medicare. You'll need to decide whether to stick with original Medicare, which is Parts A and B plus a Part D drug plan, or sign up for a Medicare Advantage Plan, which should give you comprehensive coverage.
If you opt for original Medicare, it's smart to buy a Medigap plan to go along with it. Medigap could help pick up the tab for coinsurance, deductibles, and other costs you might incur as a Medicare enrollee.
If you won't be 65 at the time of your retirement, you may need to purchase health coverage from the Health Insurance Marketplace. That could end up being a more expensive prospect than you'd think, so start shopping around for coverage before you retire so you know what to expect.
If you won't be 65 when you retire but that birthday isn't so far away, COBRA could be an option, too. COBRA allows you to retain your employer health insurance for a limited period of time once you've left your job. While it can be very expensive, if you only need coverage for a few months before Medicare kicks in, it may be a reasonable solution.
2. Create a monthly budget
A lot of people assume that their costs will shrink substantially in retirement. That may or may not be the case for you, so it's important to set a budget ahead of retirement to make sure you have enough incoming funds to cover your expenses.
Your retirement budget should account for essential expenses like housing and food as well as leisure spending and one-off bills, like occasional home and car repairs. Once you've set your budget, you can see how well it holds up based on your anticipated monthly Social Security benefits and withdrawals from your retirement savings.
3. Have a plan to keep busy
If you have a stressful job, you may be looking forward to retiring and having some downtime. But that routine could get old quickly, especially if you're used to keeping busy.
A recent MassMutual report found that 16% of retirees were more bored than expected. And 8% said they were less happy in retirement than when they were working.
It's important to have different options for keeping busy once you stop working. And it's a good idea to set yourself up with plans ahead of retirement so you're able to dive into your new routine right away.
Think about some of the hobbies you never seem to have enough time for. Will they be enough to occupy your time, or will you need to pick up some more?
Also have realistic expectations about travel. You might assume it'll keep you very busy as a retiree. But if your budget only allows for a few trips a year, you're going to need things to do in between.
Plus, extensive travel can be exhausting, and you may not enjoy it as much as you expect to. So you definitely need an alternate plan, just in case.
It's important to go into retirement knowing you've thought every detail through. If you expect to retire in 2026, take the next few weeks to address these tasks so you can feel confident embracing that next stage of life.
