Q: What do landing an aircraft and planning for retirement have in common?
A: If you get the setup wrong, the results could be disastrous.

When a jetliner flies from London Heathrow to New York JFK, the aircraft doesn’t just arrive at an altitude of 35,000 feet and drop directly onto the runway.

An hour in advance somewhere out over the North Atlantic, the pilot reviews the landing checklist. He or she radios ahead to JFK to determine weather conditions, traffic patterns, and the plane’s assigned runway.

After checking in with Air Traffic Control, the pilot calls back to the cabin crew, alerting the attendants to put away meal service, set seats and tray tables upright, and stow electronics. The pilot puts the plane into a gradual descent, lowers the air speed, lines the plane up with the designated runway, extends the flaps to provide lift for the craft at low speed, and finally lowers and locks the landing gear.

The steps on a pilot’s checklist constitute the “glide path to landing.”  We know the pilots who don’t use checklists because annually in the United States roughly 100 aircraft land with their gear up, which is both dangerous and expensive.

The same checklist process applies to retirement planning starting 10-15 years before age 65.

At our firm, we don’t expect people to start planning for retirement in their twenties, thirties, or even forties. Life at those ages is riddled with other priorities — getting married, buying a house, running a career, starting a family, getting those kids into college.

Around age 50, our clients get serious about retirement. At that point, we introduce our Pre-Retirement Preparedness Checklist (which you can download from the Investment Guides Library of our website.) 

Pre-Retirement Planning Checklist:

In broad categories, we help our clients evaluate:

• Financial planning – is the family on track to meet retirement goals?

• Review portfolio allocations, dial down risk, prepare to convert a pile of financial assets into a life time income stream

• Determine “must haves” and “nice to haves” in retirement spending, consider big projects like buying a vacation home

• Evaluate legacy goals – how much to family, how much to philanthropy?

• Determine whether to purchase long term care insurance, or self-insure elder care from a family’s own financial resources

• Consider whether revocable and irrevocable trusts can provide asset protection, side step certain estate taxes

• Fund 529 college savings plans for children and grandchildren

• Consider paying off mortgages

• Consider the value of retaining insurance policies – can the family save money by discarding unneeded protection

• Determine whether staying in the current home, downsizing to a smaller home, or moving to a new community is the right decision

• Increase time and money spent on medical care to maintain quality of life

• Review estate plans, which may often be decades out of date, review healthcare proxies, powers of attorney, end of life instructions

• Ensure that important financial and legal documents are accessible to family members but protected from cyber-thieves 

We show our clients whether they are on the “glidepath to retirement” or whether a potential problem 15-25 years from now needs to be addressed.

For example, a certain client family could potentially run of money in their early 80’s but based on family history are likely to live into their 90’s.

This scenario would be disastrous if the family learned about the shortfall at age 85.  Learning about this concern at age 55 gives the family 30 years to come up with alternatives.

We can show a family in their 50’s or even 60’s how to easily mitigate the risk by increasing their savings rate now or pushing back retirement back a few years.  We can also model the effects on the financial plan of receiving an inheritance or selling a business.  

Smooth landing or white-knuckled approach?  Using the “Glidepath to Retirement” checklist ensures that your family arrives safely and happily at the retirement destination.

David Edwards is president and wealth advisor with Heron Wealth, a $500 million registered investment advisor based in New York City working with 225 client families across the U.S. and around the world. Dustin Lowman contributed additional research for this column.