When it comes to preparing for retirement, do you find yourself asking, “I know the basics, but am I really educated about retirement planning?” We hear over and over again about the importance of saving for retirement, but what will you actually do with your time once you’re there? From encore careers to staying healthy and managing your portfolio, keep reading for the top 5 secrets to a great retirement.


With no social security tax, great healthcare options, and a wide variety of activities available, Illinois is a top-notch place to retire.

Retiring in Illinois

Retiring in Illinois offers tax-friendly advantages, making it an appealing choice for many individuals.

“Illinois provides many tax breaks on retirement income, including social security benefits and many other retirement income streams. This means that retirees can keep a larger portion of their income during their golden years (not including federal income taxes).

Additionally, Illinois has a relatively low state sales tax rate compared to other states, which can also help retirees stretch their dollars further.

Property tax exemptions are also available for seniors age 65+ who meet income and other qualifications, providing potential savings on housing costs.

When it comes to your medical needs, Illinois has excellent access to healthcare for seniors, including Rush University Medical Center in Chicago and Advocate Lutheran General Hospital in Park Ridge, where both have exceptional Geriatric Assessment Clinics.

Illinois also has the Illinois Community Care Program (CCP) to help seniors with daily living activities so they can stay in or return to their homes.

With a centrally located airport, access to the arts and activities of all types, a low cost of living, and a temperate climate with four distinct seasons, Illinois is a great place to retire.

Retirement can be a perfect opportunity to embark upon an encore career. Think outside the box and try something you've always wanted to do.

Consider an Encore Career

Having an encore career upon retirement offers a multitude of benefits that can greatly enhance one’s post-work life. Encore careers can take many forms, in both part-time and full-time roles, but they are usually centered around your personal interests, passions, or sense of purpose. Financial gain is a secondary benefit.

An encore career allows you to pursue a new passion or interest, providing a sense of fulfillment and purpose. This can lead to a renewed sense of enthusiasm and motivation, counteracting the potential boredom or loss of identity that may accompany traditional retirement.

Engaging in an encore career can also enhance your financial security and stability during retirement years. Supplementing retirement income through part-time or freelance work can alleviate financial stress and support a comfortable lifestyle.

Beyond any financial benefits, an encore career can promote continuous personal growth and learning. It offers opportunities to acquire new skills, expand knowledge, and stay mentally sharp. This ongoing stimulation and intellectual engagement can contribute to maintaining a healthy and active mind.

Retirement can be isolating, but an encore career provides social connections and a sense of community. By joining a new professional network or engaging in a different industry, retirees can forge meaningful relationships, collaborate with like-minded individuals, and contribute to their community in a meaningful way.

Don’t Set It and Forget It

Like many other things in life, your investment portfolio is not a “set it and forget it” retirement strategy. Portfolios should be rebalanced on a regular basis to return asset allocations to the desired level based on your risk tolerance and goals. You can rebalance your portfolio yourself or, if you have an investment advisor, they will do it. The benefits of rebalancing your portfolio at least once a year include:


  • Risk Management: Regular review of your portfolio allows you to assess whether your investments are aligned with your risk tolerance and financial goals. Rebalancing allows you to adjust your asset allocation to maintain an appropriate level of risk and diversification to match your tolerance.
  • Maximizing returns: Rebalancing enables you to potentially capitalize on market opportunities. When certain assets outperform others, your portfolio’s allocation may become imbalanced.
  • Long-term planning: Regular check-ins on your portfolio help ensure that your investments align with your long-term objectives. As your financial goals, risk tolerance, or life circumstances change, your portfolio should reflect these adjustments. By rebalancing, you can realign your investments to maintain a strategic asset allocation that supports your evolving needs and aspirations.
  • Portfolio optimization: Rebalancing allows you to optimize your portfolio’s performance by minimizing overexposure to certain assets or sectors. It helps prevent your portfolio from becoming too heavily weighted in a single investment, which could leave you vulnerable to excessive risk.

As for frequency, there’s no hard and fast rule for how often to rebalance your portfolio. It comes down to individual preferences. For example, some investors choose to review their investment allocations on an annual, quarterly, or even monthly basis. Alternatively, others opt to rebalance when an asset allocation surpasses a specific threshold, such as 5 percent. Consult with a financial advisor to discuss your specific needs.

Don't forget to factor in Recommended Minimum Distributions (RMDs) into your retirement plans. Ask your financial advisor for guidance.

Factor in RMDs

Recommended Minimum Distributions (RMDs) refer to mandatory withdrawals from certain tax-advantaged retirement accounts, such as Traditional IRAs and 401(k)s, that you must take once you reach a certain age.

The IRS sets specific rules for RMDs to ensure that individuals do not indefinitely defer taxes on their retirement savings. The age at which RMDs must begin depends on the type of retirement account and is currently set at 73 years old. However, for individuals who turned 70½ before January 1, 2020, the age to start RMDs is 70½.

The amount of the RMD is calculated based on the account balance and life expectancy using IRS-provided tables. Failing to withdraw the required minimum amount may result in significant penalties imposed by the IRS.

It’s important to note that Roth IRAs are not subject to RMDs during the original account owner’s lifetime, but they do apply to inherited Roth IRAs under certain circumstances.

It’s up to you what you want to do with your RMDs, such as spending the money, reinvesting it, or making charitable donations. Considering RMDs in your retirement planning will help you manage your tax obligations, optimize your retirement income, maintain a suitable asset allocation, avoid penalties, and align your estate planning goals. We recommend working with a financial advisor or tax professional who can guide you through the complexities of RMDs and help you develop a comprehensive retirement plan that considers these important distribution requirements.

Think beyond the finances and don't forget to take care of your health leading up to and during retirement.

It’s Not Just About Money

It can be tempting to focus solely on the financial side of retirement planning. However, one often overlooked aspect of preparing for retirement is to ensure you care for your health leading up to and during retirement. You’ve worked hard to be able to retire, so taking care of yourself will make your golden years more enjoyable.


  • Maintain a healthy lifestyle: Adopting healthy habits such as regular exercise, a balanced diet, sufficient sleep, and stress management can contribute to better physical and mental health during retirement.
  • Prioritize preventive healthcare: Schedule regular check-ups, screenings, and vaccinations to detect and address potential health issues early on. Stay up to date with recommended immunizations and screenings for conditions such as cancer, heart disease, and diabetes.
  • Manage chronic conditions: If you have existing chronic conditions, work closely with healthcare professionals to effectively manage them through medication adherence, lifestyle modifications, and regular monitoring.
  • Cultivate social connections: Build and maintain social relationships, as they are crucial for mental well-being and overall life satisfaction. Engage in activities that foster social interaction, join clubs or organizations, and stay connected with friends, family, and community.
  • Plan for mental well-being: Prioritize mental health by engaging in activities that promote cognitive stimulation and emotional well-being. This can include reading, puzzles, learning new skills, engaging in creative pursuits, and seeking support if needed.
  • Create a purposeful retirement: Plan for meaningful activities and pursuits that provide a sense of purpose and fulfillment in retirement. This can involve volunteering, mentoring, pursuing hobbies, or engaging in part-time work or encore careers.

Discuss your retirement goals with an investment advisor!

As a Flanagan State Bank customer, you have on-demand access to live advisors at your convenience. Visit your local branch to be connected with a Nest Egg advisor within minutes. You can also visit us online to video chat with a licensed investment advisor from the comfort of your home.

Looking for more resources? Check out our Financial Education lesson plans and our recent blog post on beating inflation with your investments.