If your goal is to retire in 2024, 2023 may function as a countdown year of sorts. At this point, you may just need to coast through your job for another 12 months until you’re ready to enjoy the freedom you’ve worked hard for.
But if you’re planning to retire in 2024, there are certain key moves you’ll need to tackle beforehand. Here are three things you should aim to do in 2023 to keep your 2024 retirement plans intact.
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1. Ramp up your retirement plan contributions
Is your IRA or 401(k) plan in good shape? If you’re not feeling as confident as you’d like when it comes to your savings balance, then take the opportunity to pump more money into your nest egg this year.
In 2023, 401(k) contributions max out at $30,000 for savers aged 50 and over, while IRAs max out at $7,500 for that age group. If you’re somehow able to save for retirement beyond that point in a single year, look to other accounts, like health savings accounts, that can be very useful in retirement. You can even pump money into a taxable brokerage account if you’ve maxed out all the tax-advantaged retirement plans you’re eligible for.
2. Establish a strategy for claiming Social Security
It’s not a given that you’ll sign up for Social Security the moment you retire. But many people do opt to go that route.
Either way, it’s important to develop a strategy for claiming benefits so you sign up at the right time. If you’re reaching full retirement age (FRA) for Social Security purposes in 2024, you may decide to claim benefits then, since you’ll be allowed to collect them in full. But if you’ll be younger than FRA in 2024, you may want to hold off to avoid a reduction in benefits.
There’s also the option to delay your Social Security filing past FRA. For each year you do, up until age 70, your benefits get an 8% boost that remains in effect for life.
3. Figure out what you’ll do with your time
Retirement can come as a shock to a lot of people — namely, because it’s hard to go from working every day and being busy all the time to being underscheduled, with hours upon hours of free time every week. That’s why it’s important to figure out how you’ll spend your days as a retiree before tendering your resignation at work. If you don’t have a game plan, you might end up bored and unhappy.
Keep in mind that your plan has to align with your financial resources. You might keep very busy traveling all over the world. But if your nest egg can’t support that sort of lifestyle, you’ll need to come up with other ideas that won’t cause a financial strain. Those could include volunteering or even starting a home-based business.
Let the countdown begin
A 2024 retirement is something to absolutely look forward to. Spend the next 12 months tackling these essential items so you’re able to stick to your plan and retire with confidence.
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