Retirement is one of life's most significant financial transitions. After decades of saving, investing, and building a career, the focus begins to shift from accumulating wealth to turning that wealth into a sustainable source of income.
If you plan to retire within the next five years, October is an excellent time to review your financial plan and identify decisions that may need attention before December 31.
The years leading up to retirement can bring important questions. Will your savings support the lifestyle you envision? When should you claim Social Security? How will taxes affect your retirement income? And how should your investment portfolio change as you approach the day you leave work?
These decisions are connected. A choice about when to retire may affect your Social Security benefits, tax situation, investment strategy, and long-term financial security.
At Colorado Wealth Group, we believe retirement planning works best when these pieces are considered together. Here are seven financial decisions worth reviewing before the end of 2026.
1. Revisit Your Retirement Timeline and Spending Goals
One of the first steps toward retirement is defining what retirement will actually look like.
You may picture traveling more, spending time with family, pursuing hobbies, volunteering, or simply having greater flexibility in your schedule. Each vision comes with different financial implications.
Start by reviewing your expected retirement date and estimating your expenses during the first several years of retirement.
Consider expenses such as:
- Housing costs, including mortgage payments, property taxes, and maintenance
- Healthcare premiums, prescriptions, and out-of-pocket medical expenses
- Travel, recreation, and other lifestyle goals
- Support for children, grandchildren, or other family members
- Debt payments and other ongoing financial commitments
- Unexpected expenses and a reserve for emergencies
Your spending may also change over time. You might spend more on travel during the early years of retirement, for example, while healthcare and assistance-related expenses could become more significant later.
A retirement plan should account for these possibilities rather than assume your expenses will remain constant.
Year-end action: Update your projected retirement budget and compare it with your current savings, expected income, and anticipated expenses. If your target retirement date is approaching, consider modeling several scenarios to see how different spending levels or retirement dates could affect your plan.
2. Build a Retirement Income Strategy
While working, you generally rely on a paycheck to cover your expenses. In retirement, your income may come from several different sources.
These might include Social Security, pensions, distributions from traditional retirement accounts, Roth accounts, taxable investments, rental income, or other assets.
The challenge is deciding how these sources should work together.
For example, withdrawing from a traditional retirement account may create taxable income. Selling investments in a taxable account may generate capital gains. Qualified Roth distributions may receive different tax treatment, depending on applicable requirements.
The order and timing of withdrawals can influence your overall tax burden and how your assets support you over time.
Instead of asking only, "How much have I saved?" consider asking, "How will my savings turn into income throughout retirement?"
A comprehensive retirement income plan should examine:
- Your anticipated annual spending
- Reliable sources of income and when they begin
- Which accounts may fund different stages of retirement
- How withdrawals may affect your taxes
- How much flexibility you have to adjust spending during market downturns
Year-end action: Create or update a retirement income projection. Compare your expected income with your planned expenses and identify potential gaps before making major retirement decisions.
3. Evaluate When to Claim Social Security
Social Security is an important part of retirement planning for many households, but the best time to claim benefits depends on your circumstances.
For many retirees, claiming can begin at age 62, although doing so before full retirement age generally reduces the monthly retirement benefit. Delaying benefits beyond full retirement age can increase the monthly amount up to age 70.
That does not automatically mean waiting is best for everyone.
Your decision may depend on your health, life expectancy assumptions, employment plans, household income needs, marital history, and whether a spouse may qualify for benefits based on your record.
For married couples, the timing of each person's benefits may also affect the household's overall retirement income and potential survivor benefits.
Social Security should therefore be considered alongside your other retirement resources, not in isolation.
Year-end action: Review your earnings record and estimated benefits through the Social Security Administration. Compare potential claiming dates and discuss how each scenario fits into your broader retirement income plan.
4. Review Your Investment Portfolio Before Retirement
As retirement approaches, your investment strategy may need to evolve.
During your working years, you may have focused primarily on growing your assets. As you near retirement, you also need to consider how those assets will support withdrawals over a potentially long retirement.
This does not necessarily mean moving everything into cash or bonds. Being too conservative can introduce its own challenges, including the risk that inflation erodes purchasing power over time.
Instead, your portfolio should reflect your time horizon, risk tolerance, income needs, and ability to withstand market volatility.
One important consideration is sequence-of-returns risk. If markets decline early in retirement while you are withdrawing money from your portfolio, those withdrawals can make it harder for your investments to recover.
A thoughtful investment strategy considers both long-term growth and the resources available to cover near-term spending.
Year-end action: Review your asset allocation, cash reserves, and anticipated withdrawals. Consider whether your portfolio remains aligned with your retirement timeline and whether you have a plan for managing expenses during periods of market volatility.
Learn more about investment management at Colorado Wealth Group.
5. Review Your Tax Strategy Before December 31
Tax planning becomes especially important as you transition from employment income to retirement income.
Your final working years may present opportunities to coordinate income, deductions, charitable giving, and retirement account decisions. The appropriate strategy depends on your current tax situation, future income expectations, and long-term goals.
Here are several areas to review.
Traditional IRA and 401(k) withdrawals
Withdrawals from traditional retirement accounts are generally taxable as ordinary income, subject to applicable rules. Understanding how future distributions may affect your tax bracket can help you evaluate potential strategies before retirement.
Roth conversions
Converting eligible assets from a traditional IRA to a Roth IRA generally creates taxable income in the year of conversion. Depending on your circumstances, a conversion may offer potential long-term tax benefits, but it can also increase current taxes and affect other income-related calculations.
A conversion should be evaluated in the context of your entire financial picture rather than treated as an automatic year-end move.
Capital gains and investment sales
Selling investments in a taxable account may generate capital gains or losses. Reviewing your portfolio before year-end can help you understand the potential tax consequences of planned transactions.
Charitable giving
If charitable giving is part of your financial goals, consider whether your current approach fits your tax and retirement strategy. Different giving methods can have different requirements and tax consequences.
Year-end action: Review your projected income and tax situation with a qualified tax professional or financial advisor before implementing tax-sensitive strategies. Some opportunities have December 31 deadlines, while others follow different rules or deadlines.
For more insight, explore financial planning at Colorado Wealth Group.
6. Prepare for Healthcare Costs and Required Distributions
Healthcare is one of the expenses that can make retirement planning more complicated.
If you retire before age 65, you will generally need to evaluate how to maintain health insurance until you become eligible for Medicare. Depending on your circumstances, coverage might come through a spouse's employer, a former employer, or an individual health insurance plan.
Once Medicare eligibility approaches, it is important to understand enrollment timing, premiums, coverage choices, and potential out-of-pocket costs.
You should also consider how healthcare expenses might change over a retirement that could last decades. Long-term care needs, in particular, can have significant implications for a household's financial plan.
Another important consideration is required minimum distributions (RMDs). Under current federal rules, many retirement account owners must begin taking RMDs at a specified age, depending on their date of birth and applicable law. Workplace plan rules and individual circumstances can affect the details.
Missing a required distribution can result in tax consequences, so it is important to understand when the rules apply to you.
Year-end action: If retirement is approaching, estimate your healthcare costs and investigate coverage options. If you are already subject to RMD rules, confirm your applicable deadlines and distribution requirements with your tax or financial professional.
7. Coordinate Your Estate Plan and Beneficiary Designations
Retirement planning is not only about funding your own lifestyle. It is also an opportunity to review how your assets may support your family and reflect your long-term wishes.
Over time, family circumstances can change. You may have experienced a marriage, divorce, birth, death, inheritance, or change in financial priorities since your estate documents were last reviewed.
Consider reviewing:
- Beneficiary designations on retirement accounts and insurance policies
- Your will and any applicable trust documents
- Powers of attorney and healthcare directives
- How your assets are titled
- Your plans for charitable giving or wealth transfers
- Whether your family understands your wishes and knows where to find important documents
Beneficiary designations can be particularly important because they may determine who receives certain assets independently of provisions in a will. The interaction between account designations and estate documents should be reviewed carefully.
Year-end action: Gather your estate planning documents and account beneficiary information. Identify anything that may be outdated and consult an appropriate estate planning attorney when changes are needed.
Learn more about estate planning resources from Colorado Wealth Group.
Why Year-End Is a Good Time to Review Your Retirement Plan
You do not need to make every retirement decision in October. However, reviewing your plan before the end of the year gives you time to identify questions, evaluate options, and coordinate with the professionals who help manage your finances.
Some decisions may be time-sensitive. Others may benefit from several months or years of preparation.
A year-end review can help you determine whether:
- Your retirement date still makes sense for your financial situation
- Your projected income can support your desired lifestyle
- Your Social Security strategy fits your household's needs
- Your investments reflect your retirement timeline
- Your tax strategy considers both current and future income
- Your healthcare and estate plans are up to date
The goal is not simply to complete a checklist. It is to understand how today's decisions may influence your financial flexibility and confidence in retirement.
Plan for Retirement With a Bigger Picture in Mind
Retirement is a major transition, and there is rarely a single decision that determines whether your plan succeeds. Your retirement date, income sources, investment strategy, tax decisions, healthcare needs, and estate plans all influence one another.
That is why a coordinated approach matters.
At Colorado Wealth Group, we help individuals and families evaluate their financial circumstances, clarify their goals, and build personalized plans that bring important financial decisions together. Whether you are several years away from retirement or already navigating the transition, having a clear strategy can help you make more informed decisions about the future.
Thinking about retiring in the next five years?
Consider reviewing your financial plan before year-end. Schedule a consultation with Colorado Wealth Group to discuss your retirement goals and the steps that may help you prepare for the next chapter.
Colorado Wealth Group ("CWG") is a financial services group offering investment advisory services through Savvy Advisors,Inc. ("Savvy"). Savvy is an investment advisor registered with the Securities and Exchange Commission ("SEC"). CWG is not a separately registered investment advisor.
