Financial planning makes for wiser, better retirement

Retirement for most people consists of at least a couple of stages. Early retirement brings a transition away from the day-to-day responsibilities of work and provides opportunities to enjoy family, friends, travel and hobbies. The latter years of retirement bring a different set of transition issues, largely as a result of loss of independence.  

Early planning makes retirement more enjoyable. Shutterstock

While both transitions require thought and planning, this is especially true as one loses independence. This planning, including the impact on one’s finances, should be done earlier rather than later. 

Questions that often arise during the transition to less independence include: 

◗ Where will you live? 

◗ How will you know if you should stop driving? 

◗ When and how should you hand over responsibility for your finances? 

◗ How will you handle the need for assisted care, if required? 

◗ How does family fit into the above questions? 

When it comes to housing during retirement, there are many things to consider, including location and physical layout. While some desire to stay where they are, even if children aren’t close by, it’s a good idea to consider whether being closer to children and grandchildren may be better in the long run. Not only does it make it easier to visit during your active years, but when the time comes that you need help, it will be easier for your children to be there for you. 

I recently received a call from an elderly woman who was frustrated that the home she and her husband lived in had so many interior and exterior stairs. As their mobility decreased, it was becoming much more difficult to navigate the house. While she thought it best they move, it was their long-time home and her husband didn’t want to. It would have been much better had the two of them anticipated this need early in retirement, long before their physical limitations created such a problem, and relocated to a more appropriate place.

Making wise choices

Driving privileges may be one of the most difficult areas for seniors to objectively assess their capabilities. It’s important to anticipate when it will no longer make sense to drive due to declining health and to think through how transportation needs will be met — and make the decision earlier rather than later. While it’s understandably a difficult decision, it’s important to avoid putting oneself or others at risk of injury or death. 

The skills required to manage one’s finances, including effective administration and cognitive capabilities, often decline during the latter retirement years to such a point that it becomes necessary to hand off these responsibilities to a trusted person. An estate plan that includes a trust is an effective way to accomplish this. Your wishes are documented in a legal manner and the trustee is obliged to manage resources according to the terms of the trust. It’s important to build in mechanisms to hold the trustee accountable. Annual reporting to key family members is one way to accomplish that accountability. 

While not everyone will require assisted living, it would be good to anticipate such a need and think through the options, including in-home care and assisted living facilities. 

Children can and should play a key role in making sure their parents are well-cared for. Scripture says, “O son, help your father in his old age, and do not grieve him as long as he lives; even if he is lacking in understanding, show forbearance; in all your strength do not despise him. For kindness to a father will not be forgotten, and against your sins it will be credited to you; in the day of your affliction it will be remembered in your favor; as frost in fair weather, your sins will melt away” (Sir 3:12-15).  

God love you! 

Phil Lenahan is the president of Veritas Financial Ministries ( and the author of “7 Steps to Becoming Financially Free” (OSV, $19.95). Submit questions for columns to