5-Year Retirement-Readiness Checklist

01 · Income inventory

• Estimated Social Security benefits at 62 / FRA / 70 documented from ssa.gov/myaccount.
• Pension benefit options (single life / joint & survivor / lump sum) requested from each former employer.
• All retirement-account balances (401(k), 403(b), IRA, Roth IRA, HSA) listed with current values.
• Taxable brokerage and bank account balances added to the same inventory.
• Rental, royalty, or business income with annual amounts estimated.
• Spouse's income inventory completed on the same form (if applicable).

02 · Spending baseline

• Last 12 months of bank and credit-card statements reviewed; spending categorized as essential vs. discretionary.
• Annual property tax + homeowners insurance separately identified (Texas tends to surprise people here).
• Healthcare costs estimated for the gap between retirement and Medicare eligibility.
• Realistic discretionary budget for the first five years of retirement (travel, gifting, hobbies).
• Inflation assumption noted (typical: 2.5–3%/year).

03 · Healthcare bridge

• Cobra eligibility window and cost confirmed (or marketplace insurance plan compared).
• Medicare enrollment timeline understood (initial 7-month window around 65th birthday).
• Medicare Advantage vs. Original + Medigap decision plan in place — including the switching limitations.
• Part D prescription plan considerations identified.
• Long-term care insurance status decided (own policy, hybrid, or self-fund).

04 · Tax-aware moves

• Pre-retirement Roth conversion years identified — the gap before RMDs at age 73.
• IRMAA thresholds understood for the two-year-lookback effect on Medicare premiums.
• If holding employer stock in a 401(k): NUA election analyzed before any distribution.
• Charitable giving strategy (Donor-Advised Fund pre-70½, QCD at 70½+) considered.
• State of residence reviewed (Texas: no state income tax, but high property tax).

05 · Account housekeeping

• Beneficiary designations checked on every retirement account, IRA, life insurance policy, and annuity.
• Old 401(k)s from prior employers consolidated or accounted for.
• Investment allocation reviewed against actual risk capacity (not just tolerance).
• Cash buffer of 1–3 years of essential expenses established to manage sequence-of-returns risk.
• Trusted contact person added on file with each custodian.

06 · Estate & legal

• Will current and reviewed within the last 5 years.
• Durable power of attorney and healthcare directive in place.
• Living trust considered (and either in place or consciously rejected).
• Texas community-property considerations reviewed with attorney if applicable.
• Successor trustees and executors named and informed of their roles.

07 · Conversation with spouse

• Both spouses agree on retirement date target (or have explicitly discussed disagreement).
• Both spouses know where the documents and accounts are (see Document Inventory worksheet).
• Both spouses participate in the planning meetings, not just the one who handles finances.