By SR Staff
Nobody drifts into a comfortable retirement by accident. The people who feel confident on their last day of work usually did one thing in common: they used the final stretch of their career as a runway, not a countdown clock. Are you using yours?
The five years before retirement are when small decisions carry outsized weight. Your savings are at their peak, your income is still flowing, and you still have time to fix gaps. This retirement readiness checklist breaks the work into 20 practical steps, grouped by area, so you can see what to tackle now and what can wait.
Get Your Money Picture Clear (Steps 1–6)
Everything else depends on knowing what you have and what you spend. Start here, because the answers shape every other decision on the list.
- Track your actual spending for 90 days. Retirement budgets built on guesses tend to miss. Real numbers show what you will need to replace.
- Separate essentials from extras. Housing, food, insurance, and taxes are the must-haves. Travel and hobbies are flexible, which gives you a cushion in bad market years.
- Add up every account. Pull together 401(k)s, IRAs, brokerage accounts, HSAs, and any old employer plans you forgot about.
- Check your savings against benchmarks. Our guide on how to tell if you are on track for retirement shows what to aim for at each age.
- Maximize catch-up contributions. For 2026, the 401(k) limit is $24,500, with an $8,000 catch-up if you are 50 or older and a higher catch-up of $11,250 for ages 60 to 63. IRA limits are $7,500 plus a $1,100 catch-up. Confirm current figures with the IRS before you adjust payroll deductions.
- Pay down high-interest debt. Carrying a credit card balance into retirement quietly eats your withdrawals. Aim to enter retirement with only manageable debt, ideally a small or paid-off mortgage.
Line Up Your Income (Steps 7–11)
Retirement is really a transition from earning a paycheck to building one. In these final years, you decide where each piece of that income will come from.
- Review your Social Security statement. Create or log in to your my Social Security account at ssa.gov and check that your earnings record is accurate. Errors are easier to fix while you are still working.
- Model several claiming ages. Benefits grow for each year you delay past full retirement age, up to age 70. Our guide to when to take Social Security walks through the tradeoffs.
- Get pension estimates in writing. If you have a pension, ask HR for payout options, including single-life and joint-and-survivor choices.
- Sketch a withdrawal plan. Decide roughly which accounts you will tap first, and how much you can take each year without draining your savings too early.
- Build a cash buffer. Setting aside a year or two of spending in cash or short-term holdings can keep you from selling investments during a downturn.
Plan for Healthcare and Insurance (Steps 12–15)
Healthcare is the line item that surprises people most, so it deserves its own section of the checklist.
- Map your Medicare timeline. Your initial enrollment window surrounds your 65th birthday. Missing it can mean lifelong penalties, so review Medicare enrollment windows early.
- Solve the gap if you retire before 65. Options include COBRA, a spouse's plan, or marketplace coverage. Price each one now, not the month you leave.
- Estimate your out-of-pocket costs. Premiums, deductibles, prescriptions, dental, and vision add up. Our article on healthcare costs in retirement can help you build a realistic number.
- Think about long-term care. Decide whether you will self-fund, buy coverage, or rely on another approach, and talk it through with your family.
Sort Out Taxes, Housing, and Paperwork (Steps 16–18)
These are the practical details that quietly decide how far your money goes.
- Look at your tax picture. A mix of pre-tax, Roth, and taxable accounts gives you flexibility to manage your bracket each year. Consider meeting with a CPA to explore partial Roth conversions while your income is still high or just after it drops.
- Decide where you will live. Will you stay put, downsize, or relocate? Housing is usually the biggest expense, and moving takes longer than most people expect.
- Update your estate documents. Confirm your will, powers of attorney, healthcare directive, and beneficiary designations. Beneficiary forms on retirement accounts override your will, so check them carefully.
Prepare for the Human Side (Steps 19–20)
A retirement plan that covers every dollar but leaves your calendar empty is only half a plan.
- Design your first year. Sketch what a typical week will look like. Many retirees find that a loose structure of volunteering, part-time work, fitness, learning, or travel keeps them energized.
- Talk with your spouse or partner. Share expectations about travel, time together, time apart, and money. Different assumptions are easier to resolve before the retirement party than after it.
How to Use This Checklist
Twenty items can feel like a lot, so spread them out. Here is a simple way to pace yourself:
- Five years out: Tackle steps 1–6 and start your Social Security and pension research.
- Three years out: Work through steps 7–11, then get a firm handle on healthcare options and tax planning.
- One year out: Finalize housing, estate documents, and your withdrawal plan, and confirm your enrollment dates.
Consider working with a fee-only financial planner or CPA for a one-time review. A second set of eyes can catch problems you cannot see from the inside. For more help organizing the pieces, browse our collection of retirement planning articles.
Your Next Step
You do not need to finish all 20 items this month. Pick the three that feel most urgent, put dates on your calendar, and start. The five years before retirement are short, but they are long enough to turn a hopeful plan into a confident one.
Written by: Seeking Retirement