# 5 steps to help you ease into retirement

It doesn’t have to be that way — being prepared can ease you into this new stage of life and help you get ready for any upcoming changes. Having goals for retirement and tracking your progress toward those goals are important throughout your life but become increasingly more crucial as retirement nears.

Take stock of your situation

As life expectancy increases, the time you spend in retirement can begin to rival the time you spend working and saving for retirement.

“To prepare for the transition to retirement, a financial planning review is essential to understand how all of the pieces come together — how are you positioned for retirement, what your options are, what lifestyle can you afford, when can you afford to retire, how conservative can you afford to be with investing your retirement savings, what pot would you draw from first,” says Cynthia Turoski, managing partner at Bonadio Wealth Advisors in Albany, New York.

“Decisions and actions you take early on can impact you immediately or down the road, and you might not see that impact until it’s too late. It’s better not to guess,” she adds.

During the review process, you’ll want to stress-test how your retirement planning pans out under varied market environments and in different situations, such as a change to your retirement age or life expectancy.

If you learn you can reach your goals, you’ll gain peace of mind. If not, revisiting plans and weighing trade-offs can help you find tweaks to make it work, Turoski says.

Understand the coming life change

Beyond the financial, there are psychological and emotional aspects to think through.

“All the focus in preparing for retirement is usually evaluating whether someone has enough money to retire,” says Philip Lubinski, retirement income specialist and founder of IncomeConductor, a retirement planning software company in Hartford, Connecticut.

But Lubinski says he has worked with clients who weren’t emotionally ready to retire, even if they were financially able to do so.

“You can only play so much golf or go fishing. How will you fill the rest of the time? For many preretirees, their work is what gives them a sense of purpose and value,” he says. “Those emotional needs must be replaced by something else other than work in retirement.”

Read: Seniors say this one thing — by far — is the definition of a life well-lived

Adjust from saving to spending

Changing your mind-set from saving for retirement to spending in retirement can be a challenge, both psychologically and financially.

Namely, you’ll want to consider how you’re balancing risk, as well as strategies that can prevent you from having to pull money out of investments when the stock market is down. Selling at a low, especially early in retirement, can significantly reduce what’s left to fund your remaining years.

One idea: allocating a portion of your portfolio to cash or fixed-income investments from which you can draw to cover expenses without selling equities in a down market, says Matt Masterson, partner and wealth adviser at RegentAtlantic in Morristown, New Jersey.

See: How much should you withdraw from your 401(k)?

As for how much risk you’re taking overall, you’ll likely want to tone down risk as you move through retirement, but it’s important not to overdo it.

“Making the portfolio too conservative will expose retirees to inflation risk that a conservative portfolio will not address,” says Lubinski of IncomeConductor.

Build an income stream

You may no longer receive a regular paycheck, but income still plays an important role during retirement.

“Not having a paycheck can impact your psyche and willingness to spend in retirement. Suddenly, every purchase may cause doubt and second-guessing,” Masterson says.

You can establish a monthly income stream through your investment plan to mimic getting a paycheck.

“Make sure you are targeting the right amount of income needed,” Lubinski says, by evaluating your expenses thoroughly. He suggests including expenses that might start later in retirement or change over time for reasons other than inflation.

Learn more: When and how will I retire? 3 strategies to get you there

Consider not just your investment portfolio but other building blocks for income, including Social Security, pensions and annuities. Keep in mind that where and how you draw income has tax implications in retirement, so it may be worth working with a financial or tax adviser to help tailor a strategy for your situation.

Look after your health

Good health is key to a successful retirement. It allows you to remain active and enjoy your retirement years, but it can also help cut costs.

One of the greatest unknowns in retirement planning is the impact of health care expenses. As you move toward retirement, understanding and planning for potential long-term care costs, which are typically not covered by Medicare, becomes increasingly important.

See: 6 ways to keep health care costs from eating up your retirement savings

It may also be wise to engage a financial adviser while you’re in good health, says Lubinski. Not only can they walk you through these complicated health care and insurance decisions, but you’ll have someone on your side for the long term.

“At some point, all retirees begin losing their financial acumen and may not make wise decisions,” he says. “Having an adviser on board at the beginning of retirement can give retirees comfort knowing their survivors will have someone to turn to who is trusted.”

More From NerdWallet

• Would Biden’s Capital Gains Tax Hike Affect You? Probably Not

• Miss the Boat on SPACs? It May Be for the Better

• What to Do With Extra Money

Tiffany Lam-Balfour writes for NerdWallet. Email: [email protected].