Listen to President Tim Russell and Pastor Drew Gysi explore this topic here.

 

I am sure you heard the idiom, “The devil is in the details…” This idiom indicates that something may seem simple, but in fact the details are complicated and likely to cause problems.

When it comes to retirement planning, there are a lot of details and moving parts!  However, if done well, with consistency over time, you can have a well-crafted retirement plan that deals with the many issues you could face in retirement.

Below, you will find a detailed, actionable checklist for you to follow from early years through retirement, and the various stages in between. 

Now, you may be in your twenties listening to this episode and say, ”why should I listen?” It is important to start planning for retirement early! If you get the details in place when you are younger, there will be less stress about retirement as you grow older.  You may be in your 20’s, 30’s, or 40’s thinking that you have plenty of time to make this retirement thing come together (and you may!)  But, what are the needed things you need to take TODAY to actually have it come all together?  We can help you with the details of how to make that come together.

So, I would like to pull “the devil” out of this discussion and allow it to be thought of as “God is in the details,” for He is the designer of all good and perfect things.  And, if God is in the details, then we know that God will use us to further His Kingdom as we live through our career-years as well as our retirement years.

Before we begin our Christian retirement planning checklist, there are a few quick questions that we should answer!

 

What about a Retirement Plan can be uniquely “Christian?”

  • The specific investments you make in order to make it to retirement. (Stewardology Episodes 35 and 36 speak to the “what is” and “how to” do Biblically Responsible Investing)
  • Your plan for how you spend your retirement years.

 

What Am I Retiring To or For?

What is the goal or retirement? There are bad objectives and good objectives

  • Bad Objectives:
    • Slothful living
    • Storing up more treasures in Earth
  • Good Objectives:
    • Service – Pursuing your calling in a new way (Numbers 8:23–26)
    • Generosity
    • Storing up treasures in Heaven. Not something you only do in retirement (or in your career-years). If you plan well, you can continue to lay up treasures in Heaven by investing in the Kingdom with your time, talent, and treasures. If you take the time to ask yourself “what am I retiring to or for, you will be able to ask the right questions that you need to in order to put a good, solid retirement plan together. 

 

1 Timothy 5:8

“If anyone does not provide for his relatives, and especially for his immediate family, he has denied the faith and is worse than an unbeliever.” (1 Timothy 5:8, NIV84)

This passage speaks to the ongoing stewardship responsibility to your family, not just for today, but also into the future! Our desire here at the Stewardology Podcast is to help you, as a good steward, to be able to think through and take the next steps needed to retire successfully. You’re not retiring into a vacuum. It is important to have a plan for what you want your retirement to look like. 

 

Christian Retirement Planning Checklist

We chose to break this down into various stages of life.  So if you are a twenty-something or a sixty something, you will have some clear actionable steps to move forward.  To begin, let’s take a look at our first stage which is…

ALL STAGES OF LIFE

  • Complete a Stewardship Review. Don’t do it alone! A Stewardship Review will help you figure out what goals you have, where you are now, and how you can achieve your goals. If able, work with a trusted professional to review your investments and taxes on a regular basis.
  • Have a Spending Plan, keeping the 5 Biblical Priorities in mind.
    • We often are asked this question…“How Much Money Do I Need for Retirement?”  To answer that question, you need to know what your spending plan (or budget) might look like. But, it is not just putting one together, it is also following that spending plan that you put together for you and your spouse/family! For many, living on a budget is a game changer, because if you do, there is greater likelihood that you will be able to fulfill the needed and necessary steps for a successful retirement.

 

EARLY CAREER STAGE

  • Life Insurance
    • The purpose of Life Insurance – Replace income in case of spousal loss or loss of income.
    • How Much Do I Need? – Depends on which spouse needs the insurance, their income, any kids, and what debt you may be carrying.
  • Knock down student loan debt. Cut down your lifestyle and make larger payments on your student loans.
    • Use an online calculator that can help you put a repayment plan together with a target date to be free and clear of all student loan debt!
    • This has become the number two cause of people having financial troubles or challenges. Number one is consumer debt (credit cards)
  • Opt into your employer’s retirement plan
    • If you are not sure if your employer has a retirement benefit or plan, just ask the Human Resources person at your work!  
    • Put money in a Roth (after-tax) component of your 401(k) or other retirement plan.
    • Consider putting 10%-25% of your income into retirement savings.
    • Take advantage of your company’s free retirement savings match. 
  • Fund a Roth IRA
      • A Roth IRA is an after-tax retirement savings vehicle that allows you to save for retirement while also having the flexibility to fund other financial needs along the way.
  • Establish an Estate Plan
      • Wills (If you are married, you’ll need one for each of you.)
      • Powers of Attorney (Healthcare & Financial – one of each, for each of you if you are married)
      • How often should you revisit or revise your estate plan? 
        • Every 5 years review it and make any needed adjustments. 
        • When you hit a milestone (kids are over 18, reaching retirement years, etc.), then you’ll want to update it. 
      • State your intentions for charitable giving in your Estate Plan so that it is not guesswork for your heirs!
  • Minimize and avoid consumer debt. Nothing can cramp your retirement options like carrying consumer debt on depreciating assets, such as vacations, credit cards, cars, etc…
    • If you are still holding onto past debt, get serious about knocking it out now!  Every year you choose to delay the process of getting this debt behind you is a year of choosing to live and give on a much lower standard. Freeing your money up will allow you to save, live and give in much greater ways!
  • Start funding your children’s education. 
    • This may be idealistic to encourage you to start funding your children’s future higher educational endeavors, but the longer you wait, the more you will need later on because you are losing the time value of that money invested! By choosing to do something now at this stage, you will potentially be able to ignore the lure of student loans for you and your children!
    • A good place to start is to consider funding a 529 or Coverdale. Talk to a financial professional to see what option is best for you. For more detail on funding higher education, go to Stewardology episode #26 and listen to that again!

 

MID CAREER STAGE

  • Pay extra toward your mortgage. There are many mortgage calculators online. Consider picking one, and punch in your information and see the impact that paying extra can make for you!
  • Review your Estate Plan. Every time you enter a new stage of life, you should review your estate plan.
  • Increase your 401(k) or other retirement plan contributions as you get raises. Build into your brain that this is a common sense action step to make each and every time you get a raise, bonus or increase in income!
  • Buy cars in cash to avoid car loans. Cash is king when it comes to car purchases! Avoid, if you can, at all costs, financing (especially financing for long periods of time) any vehicle purchase!  
  • Review Life Insurance needs. Earlier in your life, hopefully you took our guidance and purchased some much needed life insurance.  If so, at this stage, it would be very good to review the policy in light of your family, income and assets. If you are on track for retirement, make sure that you still have enough insurance. If you are behind on your retirement savings, you may need to increase the amount of insurance you have or extend the amount of time your insurance covers.
  • Education Funding Plan. Your kids may be at the time of their lives where higher education is at their doorsteps.  If this is the case, then there needs to be additional concentrated focus on how your child/children will pay for, if interested, their higher education. A few key things that you should know when it comes to paying for these educational expenses:
    • Avoid co-signing loans.
    • Avoid dipping into retirement to pay for education.

BONUS CHECK LIST ITEM: If you are on track for your retirement savings, it’s okay to spend some money on your family and enjoy fun trips and experiences.

 

LATE CAREER STAGE

  • Review retirement plan & readiness with a financial advisor.
    • This is a very, very smart action step!  At this stage it is imperative that one gets an outsider’s point of view on where you are and help you with a roadmap to get you where you need to, or want to be in the upcoming years! Remember, you don’t know what you don’t know!  Connect with a professional that will ask you the right questions and help you come up with the answers to those questions.
  • Pay off your mortgage. Stay out of debt! 
    • Is owning your home an important part of the plan? If so, you have reduced your monthly living expenses by hundreds/thousands of dollars per month.
    • If downsizing your home is an important part of the plan, it would be very good to do so and not take on any additional debt in the process!
  • Work on an actual spending plan for retirement.
    • This will be a new phase of life for you and your spouse!  It would be good to have a solid idea of what your essential expenses, needs and wants would cost you yearly/monthly and to know that you have the income in those days to meet those needs and then some!
    • When it comes to mapping this out, there are two main categories:
      • Income (Social Security, Pensions, Retirement Savings, Part time work, etc.)
      • Expenses (Real estate taxes, utilities, groceries, travel, insurances, vehicles, etc.)
  • Have a Stewardship Plan for Maintaining your Property through your Retirement Years
    • We mentioned it earlier, but downsizing is not just to reduce costs, but for many it is imperative to alleviate the vast property maintenance that a larger home/property absorbs from you in your younger years. Consider putting a plan together now that includes a time when you can no longer live in your own home!  What would that look like, where would you go, and what would your needs be financially?
  • Long Term Care Insurance (LTCI). 
    • Consider purchasing LTCI if you have a family history of needing extensive care at old age. Consider this when you get to your early 60’s. If you do this, read the fine print!  This area of insurance is changing quickly, so be informed and ask a lot of questions.
  • Revisit your Estate Plan.
    • Again???  ABSOLUTELY!
    • As you do review your estate plan, look specifically at the key roles and verify that the people in those roles are alive and ready/willing to serve in this capacity.  
    • Also, review any charitable giving through your estate.  If you moved, you may want to re-adjust the church that you are going to be generous toward since you are in a new place.
    • Also, review and adjust any person to whom you are giving money.
    • There are often legal estate planning changes in the state and federal arenas. 
      • It would be very good to make any and all NEEDED updates to your will’s legal framework that you have included in your will.  
      • One such addition over the last few years is the transfer of a new category called “digital assets”.  This would include owned software, ebooks, movies and items like that.

Stewardship Application

Planning out your retirement now, and even going through a checklist to see where you are at, and what you need to do to meet your goals, is clearly operating with wisdom.

  • Proverbs 21:5 – “The plans of the diligent lead surely to abundance, but everyone who is hasty comes only to poverty.” (ESV)

If you are moving in this direction, you are planning ahead as Scripture just stated. By doing this we are honoring the Lord by being a good steward of the resources in our care today, for ourselves and our family, and also adding into it a provision for our latter years if the Lord so chooses to tarry in His triumphal and glorious return!

 

 

 

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