I Asked ChatGPT What To Do If I’m Retiring in 5 Years: Here’s What It Said
Written by
Peter Burns
Edited by
Levi Leidy
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As you approach your 60s, you’ll have to make a lot of decisions that will impact how you live in retirement. If you still have five years before you make the leap, for example, there are things you can do to set yourself up for a comfortable lifestyle.
For some perspective on the topic, I asked ChatGPT how to prepare for retirement five years before it happens. This is what it said.
Know Your Net Worth
The first step ChatGPT suggested was understanding where you stand financially. It wrote: “Start by assessing your financial health. Calculate your net worth by subtracting liabilities from assets, and review your current income and expenses. This will help you understand where you stand and highlight areas that need improvement, such as paying off any existing debt.”
About four in 10 Americans don’t have any savings for retirement. If you do, you’re in a good position. However, it’s vital to know your current financial state, as ChatGPT points out.
Your net worth is the foundation for your retirement and a good indicator of how close you are to being ready for it.
Determine Your Goals
ChatGPT highlighted the importance of having retirement goals, saying: “Consider the lifestyle you want in retirement, including whether you’ll travel, move or downsize your home. Think about how your daily living expenses will change and how much income you’ll need. Clarify your target retirement age, and make sure it aligns with your financial situation and personal preferences.”
Having a clear understanding of what you want your retirement to look like is vital for attaining happiness. ChatGPT brings up the possibility of downsizing your home, which can have several benefits. You’ll have access to more money for more financial flexibility. A smaller house can also mean easier accessibility as you get older.
When you know your goals, you can also set up a more efficient budget. You’ll need to have a retirement spending strategy to maintain the life you want to live. However, it’s just as important to have a budget for the five years before you retire. If your net worth is lower than you expected, you can take the necessary financial steps over the next few years to boost it.
Plan Your Income
Having income is an essential part of retirement. ChatGPT wrote: “Identify all potential income streams in retirement, such as Social Security, pensions, retirement accounts or other investments. Review how much you can expect to receive from each source and when. Consider whether you’ll still need to contribute to your retirement accounts in the next five years.”
No matter how much you’ve saved, it may not be enough to cover your expenses in retirement. If you’ve paid taxes, you’ll almost certainly be eligible for Social Security benefits. The amount you receive each month will depend on how much you made while working and when you begin taking benefits. For example, if you begin taking Social Security at age 62, you’ll receive 70% of the full amount you’re eligible for. On the other hand, if you wait until you’re 70, you’ll receive 124%.
You’ll need to combine your Social Security benefits with other sources of income, such as withdrawal amounts from IRAs and 401(k)s. Having five years to prepare will allow you to maximize contributions to these retirement accounts, increasing your retirement income and allowing you to delay taking Social Security longer.
Get Mentally and Emotionally Ready
There’s more to retirement planning than money matters. ChatGPT said: “Retirement isn’t just a financial shift — it’s a psychological one. Think about how you’ll spend your time after you retire and how to stay mentally and physically active. Staying socially engaged and pursuing hobbies or volunteer work can provide fulfillment.”
It’s easy to get wrapped up in the financial aspects of retirement, and many overlook what they’ll do with their time. Having extra time in retirement sounds great, but having no job can lead to a lack of purpose. If you’re not mentally and emotionally ready for retirement, you may deal with anxiety, stress and depression. Taking the next five years to embrace the change and find a new purpose will make your retirement life much more comfortable.
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