Until you hit your 50s, retirement seems like a far-off fantasy. Planning for something that's decades away almost feels foolish -- like you're putting money someplace you may never use it.

That's a risk, of course. You could save diligently through all your working years, sock away a big retirement nest egg, and then get hit by a bus on the way to your retirement party. It's possible you could get eaten by a bear at 40 or swarmed by killer bees in your 50s.

The reality is, though, that most Americans will make it to retirement age. Life expectancy in the U.S. in 2019 sits at 76 for men and 81 for women. Chances are, you will need to have money put away for retirement. And, even if you plan to never stop working, health problems may force your hand, so while planning for the future may seem a bit silly, it's really important.

The new year is a smart time to examine where you stand in your retirement planning. Image source: Getty Images.

The new year is a logical time to take stock of your assets. Your need and urgency vary based on your age. If you're 25, then you still need to know where you stand, but you have plenty of time to make major course corrections. Once you hit 40 or so, it's more urgent to ensure you're making the right moves and planning adequately for your eventual retirement.

It's important to take stock of where you stand. This list may not cover everything, but it hits the major financial bullet points:

Some of these questions have clear answers, while others may be up in the air. For example, your child may earn a scholarship or elect to go to an expensive private school versus a cheaper state one. That should not stop you from doing the best calculation you can to see where you stand, how much you have now, and where you might be when you hit your mid-60s.

There's no specific answer to the question "How much do I need to retire?" Your calculation will depend upon how much you plan to spend in retirement. That's predicated on a number of choices, including where you would like to live and what type of life you want.

A retirement filled with travel and expensive hobbies costs more than one where you move someplace cheaper and live a home-based life. You may not know exactly how you want to live in retirement even when you hit your 50s, and you most certainly would just be guessing if you're even younger.

Because of that, it makes sense to plan to have as much money as possible. Having more cash socked away in your retirement accounts opens up more options when it comes time to retire.

Many people use an 80% guideline -- meaning that if you made $100,000 a year while working, you will want to have $80,000 per year in retirement. That calculation can vary a lot -- and exactly how much you need depends upon how long you plan to live -- but it's a starting point.

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The keepers of Hunterdon Countys past are in search of someone to guide them into the future.

The Hunterdon County Historical Society is in the process of hiring a new part-time administrator following the retirement of Executive Director Patricia Millen, whose last day with the organization was Dec. 24.

According to Interim Administrator Janice Armstrong, a search committee comprised of the societys trustees are currently interviewing candidates for the role, and are seeking to fill it by the end of this month.

Millens replacement will serve on a team including a professional archivist and librarian, as well as a dedicated group of volunteers. Armstong said that the new administrator should ideally have a background of working in nonprofit organizations, and be proficient in planning, programming, and dealing with the public."

Were really looking for someone that can take on the day-to-day things that are needed, which would be things like writing grants, dealing with answering questions when people call up about things. Just the day-to-day operations," Armstrong stated.

Armstrong added that the search committee preferred that candidates be residents of Hunterdon County and knowledgeable of its history, though she emphasized that neither quality is required.

Millen, a resident of Mercer County, said she knew some Hunterdon County history upon taking on the administrator position in January 2015, but was especially skilled in the clerical duties the role demanded.

When you work with smaller historical societies or smaller museums, you have to have a little bit of knowledge about everything. Grant writing, fundraising, programming, collections management," Millen said. "Thats why you cant just hire a librarian to run a museum, or a museum person to run a library. People have to understand all of the aspects of the job, so its not always an easy position to fill.

Millen developed these skills after garnering over 25 years of experience as a director, supervisor, curator and site administrator in museums and historical organizations across the tristate area.

She also authored a number of historical books, including From Pastime to Passion: Baseball and the Civil War and Bare Trees: Zadock Prat, Master Tanner and the Story of What Happened to the Catskill Mountain Forests.

Reflecting upon her decision to retire, Millen said she was just ready to pursue other occupational endeavors, as well as spend more time with her family.

I wanted to do my own research and writing. And Im going to be doing part-time consulting -- helping smaller historical organizations with grants, collections, managements, things like that," Millen explained. So I still want to work and keep my mind active, but I want to do it on my own terms now, (and work) around my grandchildrens schedules."

Millen said that her fascination in the organizations expansive collections primarily drew her to apply for the administrator role over five years ago, which she served in prior to being promoted to executive director for society.

As a museum person, and a history person, thats just one of those things that draws you to a place," Millen said. They just have an amazing collection, and I was very, very impressed with the (Hiram E. Deats Memorial) Research Library and the archives building that the society built (in 2009) ... and I thought this would be a good fit for me, and it turned out to be.

Reflecting upon her work with the society, Millen said that she was particularly proud of acquiring three separate grants that enabled the organization to further enhance these collections through cataloguing them both physically and online.

The collections are catalogued and online for the public all over the world, and I think thats really important for a small historical society; if theyre going to collect, they have to be able to ... share those collections, Millen said. "And these small repositories all over the country often dont have a way of doing that. The only way you can do that is get your collections online.

Armstrong praised Millens commitment to cataloguing Hunterdons history, stating that she did a wonderful job" of organizing the Doric House museums collections in particular.

We have an extensive collection of quilts and paintings and Civil War uniforms ... and she made sure they were all catalogued, and put as much online, on our website, as possible, which was wonderful too, so people could search for things, Armstrong said.

Millen also obtained an approximately $20,000 grant from the New Jersey Historic Trust to guide the future use of the Doric House.

I was really happy to get that before I left, because I knew, as a director, it was something the society needed to do to make some decisions about its future growth and where they wanted to be in the future, to secure their place in Flemington and Hunterdon and the state," Millen said.

Echoing Millen, Armstrong said that the Doric House needs to be used more by the society and those interested in the history of Hunterdon County.

Its a building that costs us a lot of money to care for, and its not used enough. Were hoping, in the future, that we find a better use for it than the House museum," Armstrong said. Other than trying to grow our audience, and get more of our collection online, I think that thats the other important thing we have in our future.

Courtesy - Hunterdon County Historical Society

Exterior of Doric House

Looking forward, Millen emphasized that whoever is hired to fill her shoes should collaborate with other employees of the organization to prioritize both the use of the Doric House and the management of their collections within the Research Library.

Whatever they do in the future, I think they have to focus on the strength of the collections they have, and the other strength of their collections ... are their manuscript collections for their Research Library. Its an absolutely amazing wealth of information there for their researchers, Millen said.

Whoever comes in there needs to be a professional, needs to understand that tough decisions need to be made. And then just act on them. And if one avenue doesnt work, try another one. But just keep moving forward, she added.

Discussing the importance of the society and its continuance, both Armstrong and Millen underscored its value in recording the history of Hunterdon County.

Were an important part of preserving local history, and if you have an interest in history, its an interesting place to work. We get a lot of people doing genealogical research, research on the history of their homes, so if thats what youre interested in, its certainly the right place to be," Armstong said.

If it wasnt for historical societies all over the country -- theyre really the ones who chronicle our history and maintain it. And every part of local history is tied to some event in American history or world history. And its those individual histories that paint a picture of the history of the country ... its all pieces of the puzzle," Millen said.

"And I just think theres nothing more important than keeping and maintaining and preserving history.

For more information about the Hunterdon County Historical Society or the administrator position, visit http://www.hunterdonhistory.org, call 908-782-1091 or email hunterdonhistoryinfo@gmail.com.

Caroline Fassett can be reached at cfassett@njadvancemedia.com.

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Jim Schell

There was a desire on my part to continue a very active practice and do so unencumbered by institutional requirements that ran contrary to that. When you add in the respect and affection I have for people here [at Mayer Brown] from prior experiences, it was a relatively easy decision.

Jim Schell, now a partner at Mayer Brown, told Law.com that part of the reason he lateraled from Skadden a firm he practiced at for over 30 years was a desire to practice after 70, Skaddens mandatory retirement age. He also said that at Mayer Brown, I wouldnt have to worry about a time for you to go business model. I want to be active, I have been active, and this was an ideal home for me to continue to do that.

Kathryn Rubino is a Senior Editor at Above the Law, and host of The Jabot podcast. AtL tipsters are the best, so please connect with her. Feel free to email herwith any tips, questions, or comments and follow her on Twitter (@Kathryn1).

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View this article online at https://www.fedsmith.com/2020/01/06/retirement-backlog-hits-lowest-point-year-end-2019/ and visit FedSmith.com to sign up for free news updates

The outstanding backlog of retirement applications at the Office of Personnel Management dropped by 8% last month thanks to a smaller than usual number of new claims received during December.

OPM said that it received 5,205 retirement claims in December and processed 6,687 which brought the backlog down to 16,908, the lowest it has been for the entire calendar year in 2019. Its also lower than it was a year ago when it stood at 18,019.

By way of comparison, the backlog at the end of 2017 was 14,515, 15,097 at the end of 2016, and 11,399 at the end of 2015.

OPM took 66 days on average to process the claims during December.

Last months progress on lowering the backlog is a good thing since January is a notoriously rough month for OPMs retirement services office when it usually receives a flood of new retirement applications with many federal employees retiring at the end of a calendar year. It will be interesting to see how this January compares to others; stay tuned until next month!

*Disability determinations are only included in the pending number after approval. **Pending retirement cases produced in less than 60 days, on average took 36 days to complete; whereas cases that were produced in more than 60 days, on average, took 130 days to complete.

2020 Ian Smith. All rights reserved. This article may not be reproduced without express written consent from Ian Smith.

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Ponte de Lima, Portugal

THEGIFT777 | iStock Unreleased | Getty Images

Didn't save enough for retirement?

One solution: Spend your golden years in a country where life is less expensive than it is in the U.S.

More Americans are doing just that.

The number of retirees who are collecting Social Security abroad rose 40%, to more than 410,000, between 2007 and 2017. More than 160,000 are in Europe, and over 90,000 are in Asia. Thousands of others are in Canada and Mexico.

More from Personal Finance: Why you might not want to move all your IRA money to a Roth Here's why you should consolidate those 401(k)s and IRAs If you hit the $237 million Powerball jackpot, this is your tax bill

Aspiring expats should do their homework before they start packing. For example, Medicare typically provides no coverage abroad. And you'll want to figure out the tax implications of retiring in, say, France instead of Florida.

But there's no question you stand to save a lot by relocating to a place such as Portugal or Vietnam, according to International Living, a website for expats, which recently released its annual global retirement index for 2020. (In its ranking, the site factors in not just the cost of living and housing, but perks offered to older residents, plausibility of permanent residence, health care, governance and general opportunity.)

Your retirement budget will hopefully go further in these 10 countries.

Lisbon, Portugal

SeanPavonePhoto | Getty Images

You can live a comfortable life here for about $2,500 a month.

Flag on Cinta Costera, Panama

Dixon Hamby

You can get by in Panama City for around $2,600 a month, including rent, groceries, utilities and entertainment.

Manuel Antonio National Park, Puntarenas, Costa Rica

Christer Fredriksson | Getty Images

A couple can live on a budget of around $2,000 a month here.

Tourist couple looking at Gaviota Azul beach, Cancun, Quintana Roo, Mexico.

Getty Images

A couple can live here for $1,500 to $3,000 a month, depending on location.

A horse-drawn carriage in colonial Cartagena, Colombia.

Dan Herrick | Getty Images

You can retire here for$1,030 to $2,720 a month, depending on location and lifestyle.

Quito, Ecuador

Gabrielle and Michel Therin-Weise | Getty Images

A couple can get by here for around $1,800 a month.

Kuala Lumpur, Malaysia

Muhammad Hafiz bin Muhamad | Getty Images

A couple can live in Penang for $1,800 a month.

Panorama of Puerto Viejo, Spain

Mimadeo | iStock | Getty Images

A monthly budget of $2,500 a month will allow a couple to live well in most parts of the country.

The Canal de Brienne in France.

nito100 | iStock Editorial | Getty Images

Outside of major cities such as Paris and Lyon, a couple can live here for under $2,500 a month, including rent and health care.

Mu Cang Chai in Yen Bai, Vietnam.

Sumith Nunkham

In Ho Chi Minh City and Hanoi, two people can live well on less than $1,500 per month.

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The 10 best places to retire abroad - CNBC

Sunset on Dominical Beach. (Tico Times file photo.)

International Living, a United States-based publication specializing in you guessed it living internationally, has named Costa Rica among its best places to retire in 2020.

Costa Rica ranks third on International Livings list, behind Portugal and Panama, and ahead of countries including Colombia, Mexico, Spain and France.

Why Costa Rica? According to Kathleen Evans, International Livings Costa Rica correspondent, the Central American country attracts visitors with its tropical climate; low cost of living; top-notch, affordable medical care; bargain real estate; and natural beauty.

A couple can live a comfortable, but not necessarily extravagant life here for around $2,000 a month, Evans writes.

International Living cites a welcoming culture, the more progressive government of President Carlos Alvarado, affordable healthcare and the countrys dozen microclimates as reasons to consider Costa Rica.

Check out the full list on International Living here.

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Almost a quarter of Americans have less than $5,000 saved for retirement.

And to someone with no savings and an annual salary of $75,000, the idea of putting away $2 million for retirement can seem like an impossible goal. It can be done, however, it will take time and dedication.

As a rule of thumb, most financial advisors suggest you save 10% to 15% of your salary. But if your goal is to get to $2 million, the percentage you need to invest will vary widely based on how old you are when you start.

NerdWallet crunched the numbers, and we can tell you exactly how much of your $75,000 you'll need to tuck away to get there.

Just a few things to remember: These numbers assume you have no money in your retirement plan, that you will get an average 6% return on your investments and that you will retire at age 65.

The math also does not account for potential pay increases, employer matches, inflation or any curveballs that life may throw at you. So plan accordingly.

Now let's dive into the figures.

More from Invest in You: How Walmart and other big companies are trying to recruit more teenage employees Americans are more in debt than ever and experts say 'money disorders' may be to blame

Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.

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How to save $2 million for retirement if you make $75,000 a year, broken down by age - CNBC

FOX Business' Kristina Partsinevelos reports on how Congress aims to pass 401(k) changes including small business packages and part-time worker eligibility.

Lawmakers are preparing to pass comprehensive retirement reform, which would give more people access to retirement accounts,for the first time in more than a decade, with the aim of helping Americans save enough to live comfortably throughout their older years.

The Setting Every Community Up for Retirement Enhancement,or SECURE, Act is tied to a bipartisan spending bill that Congress must pass in order to sidestep a government shutdown at the end of the week.

The legislation contains a number of provisions that experts believe could meaningfully help Americans stash away more money, but also some that are perceived as negative for taxpayers.

It [is] quite a comprehensive bill, Chad Parks, founder and CEO of Ubiquity Retirement + Savings, told FOX Business. I think that the best way to characterize this is, its kind of cleaning house [Lawmakers] knew they had all these little things that are not quite right.

PENDING RETIREMENT RULE COULD MAKE THE IRS YOUR BIGGEST IRA BENEFICIARY, EXPERT WARNS

HOUSES $1.4T SPENDING BILL IS REALLY IRRESPONSIBLE: CRFB PRESIDENT

One of the key parts of the legislation is that it aims to increase access to retirement plans,which is among the biggest savings barriers right now. The government will give tax credits to small businesses for having plans.

The government is paying you to put a retirement plan in place, Parks said.

The tax credit expires after three years.

The bill would also make it easier for companies to band together to offer multi-employer plans. Some businesses would berequired to allow some part-time workers to participate.

Multi-employer plans are currently available, but the legislation would change one significant rule that might encourage more businesses to participate. The so-called one bad apple rule refers to the fact that if 10 employers go into a plan together, and one person doesnt follow the rules, the whole group will suffer. Now, Parks said, businesses would be allowed to outsource two fiduciary rules to address that dilemma.

In order to help Americans stretch out retirement savings over their lifetime, the plan also calls for an annuity option in retirement plans, which are fixed sums paid out over a lifetime.

John Iammarino, the principal and founder of Securus Financial, told FOX Business the annuity option is particularly important since future retirees won't have a pension like their parents and grandparents.

It doesnt matter how much money you have if you dont turn it into a predictable lifetime income stream, Iammarino said. The annuity option [gives people] the ability to have a predictable income stream and helps alleviate some of that pressure from Social Security.

Another pair of provisions target the flexibility of accounts: People would be allowed to stash money into IRA accounts beyond the current age limit of 70 1/2. It would also delay when individuals are required to begin taking required minimum distributions to 72, from 70 1/2.

Iammarino saidraising the contribution threshold will have that significant of an impact on most people, but delaying the age at which individuals would be required to withdraw funds from their accounts allows for nearly two extra years of planning and delays potentially being pushed into a higher tax bracket.

Among the changes that could be negative for retirees is the elimination of stretch IRAs. The proposal stipulates that most non-spouses who inherit an account must drain it within 10 years of the owners death, while the current law allows them to stretch it out over a lifetime.

Stretch IRAs are an estate planning strategy that allows people to pass their retirement funds to their kids, grandkids or other beneficiaries. For example, achild, who inherits money held in a parent's retirment account, under current law,can allow that money to grow tax-deferred or tax-free over the course of a lifetime and that beneficiary can take smaller required minimum distributions along the way, which is based on age and life expectancy. Those distributions, however, are subject to income taxes. Since larger distributions will need to be made during the 10-year timeframe, the tax liability could be larger.

If you are leaving money then you might want to have some different plans You could be making the IRS your biggest beneficiary, Iammarino said.

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Overall, however, experts are optimistic about what lawmakers are trying to accomplish.

At the end of the day, todays retirement is on the employee, Iammarino said. I dont think the bills going to have an overall impact on peoples ability to save, but I do think people over the long haul will be happier in retirement with their annuity option.

The SECURE Act is attached to a package of spending bills that lawmakers need to pass by Friday in order to avoid a government shutdown. The retirement bill itself passed the House by a margin of 417-3 in the spring, but progress had stalled in the Senate.

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When you are ready to retire, there are certain basic things you should do before you leave the comfort and security of your old job. You need to make final adjustments to your financial plan and make important decisions about Social Security and health insurance.

Here's a checklist for retiring in 2020:

-- Decide when to start Social Security.

-- Sign up for Medicare or other health insurance.

-- Check your retirement benefits.

-- Take advantage of last-minute benefits at work.

-- Consider rolling over your 401(k) to an IRA.

-- Make a financial plan.

-- Decide what to do next.

Remember to do these things if 2020 is the year you're finally going to take the leap into retirement.

Decide When to Start Social Security

You're eligible to claim Social Security payments beginning at age 62. However, you will receive a reduced payment unless you begin collecting benefits at your full retirement age, which varies depending on when you were born. For example, the full retirement age is 66 and 2 months for people born in 1955. You can increase your monthly payments if you sign up for Social Security after your full retirement age. Each year you wait, your monthly benefit grows by about 8%, up to age 70. Sign up for a my Social Security account to view how much you will receive from Social Security if you start payments at various ages.

[Read: Medicare Enrollment Deadlines You Shouldn't Miss.]

Sign Up for Medicare or Other Health Insurance

Medicare coverage begins at age 65, regardless of your Social Security full retirement age. When you enroll in the program you will need to make decisions about Medicare supplement plans and prescription drug coverage or Medicare Advantage plans. If you retire before age 65, you have to figure out how to get medical insurance that isn't connected to your job. Some people qualify for health insurance through an old employer, professional organization or a working spouse's health insurance plan. You can also obtain coverage through your state's health insurance marketplace until you qualify for Medicare.

Check Your Retirement Benefits

Confirm eligibility for a pension or other retirement benefits you earned at work. Also, check to see if you qualify for benefits from a previous employer. You might collect income from two or three places where you worked during your career. Find out if you're eligible for retiree employer-subsidized health insurance. Check to see if retirees can take advantage of any other company-sponsored benefits, from life insurance to membership in a health club to employee discounts on company products.

[Read: How Much You Will Get From Social Security.]

Take Advantage of Last-Minute Benefits at Work

If you have dental and vision coverage at work, you may want to visit the dentist and pick up a new pair of glasses before you retire. If the company matches any charitable giving, then make your annual contribution before you retire. If your child has an employer-sponsored college scholarship, see if the scholarship will continue after you leave. This is your last chance to use the benefits the company offers.

Consider Rolling Over Your 401(k) to an IRA

Employers typically allow you to keep your 401(k) account with the company after you retire. However, you might be better off transferring the money to an IRA or Roth IRA. IRAs typically have more investment options, and you can shop around for lower cost or better performing funds. If you own company stock, either inside or outside a retirement plan, now may be the time to sell some in order to diversify your holdings. You may also want to tweak your investment strategy and make a plan to minimize taxes as you draw down your retirement assets.

[See: 10 Tips for Rolling Over a 401(k) When You Change Jobs.]

Make a Financial Plan

There's more to financial planning than tending to an IRA. Try to make a budget that details your expected income from Social Security, pensions, retirement savings, other investments and part-time work. Then estimate how much you're going to spend. The estimate may have contingencies, such as spending less by moving to a lower cost community or spending more if you're planning to travel, but you should have some idea of what your expenditures are going to be, at least for the next few years. Don't forget to include an emergency fund, in case of unexpected bills like a medical emergency or major home repair.

Story continues

Decide What to Do Next

There's more to retirement than your finances. Try to imagine what your retirement life is going to look like. There are major decisions to be made about what you are going to do each day. Perhaps you are planning to move to a new location, buy a beach cottage or extensively travel. Maybe you're going to play golf, learn a foreign language, start a second career or take care of your grandchildren. When you're retired you have the freedom to do what you want, which means you have to identify something meaningful that will keep you active and engaged in life.

Tom Sightings is the author of "You Only Retire Once" and blogs at Sightings at 60.

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How to Retire in 2020 - Yahoo Finance

Electrical products and power management company Eaton (NYSE:ETN) -- up nearly 38% on a year to date basis as I write -- was arguably the best stock of the year if you're a retiree. The company is far from being the most exciting stock on the market, but boring should do just fine for investors looking for a reliable stream of income in their old age. Here's how Eaton made it to the top of the list and why it's still an attractive investment for 2020.

Image source: Getty Images.

First, a few words on the selection process -- not least so readers can perform such exercises themselves in the future. Using commonly available stock screeners, the following filters can be used to whittle down the universe of suitable stocks. For reference, this is not a list of the only suitable stocks for retirees, just ones that performed the best in 2019 within certain parameters -- there are many other ways to find stocks suitable for retirees.

As outlined below, I've looked for stocks with a current yield in excess of 3% and manageable debt with good dividend coverage.

Filter

Metric Explanation

Rationale

Stocks Left After Filter Applied

Market Cap Above $2 billion

Price times shares listed

Need for liquidity in a stock

837

Dividend Yield Above 3%

Dividend divided by price

Need for a decent income

165

Return on Equity Above 10%

Net income divided by shareholders equity

Retirement stocks must have growth potential

100

Long-Term Debt to Equity Below 60%

Long-term debt divided by equity

Debt can become a significant issue in a recession

24

Current Ratio Above 1

Current assets divided by current liabilities

Company must have good liquidity

10

Payout Ratio Less Than 75%

Dividend divided by earnings

Flexibility to grow the dividend

4

Data source: Author's analysis using macrotrends.com stock screener.

The four final candidates are shown below. It can immediately be seen that Eaton and asset manager Eaton Vance (NYSE:EV) were the best performers in 2019.

ETN data by YCharts

I'll focus on Eaton in a moment, but it's worth noting that the two technology also-rans, namely telecommunications equipment company Cisco Systems (NASDAQ:CSCO) and integrated circuit maker Maxim Integrated Products (NASDAQ:MXIM) are companies that many investors would dismiss as candidates for a retirement portfolio in any case.

Cisco is a worthy company, but to buy the stock for the long term, you need to be confident in the long-term future for its switches and routers as internet infrastructure moves away from the enterprise level toward the cloud.

Similarly, Maxim Integrated is an exciting company, especially as the Internet of Things (IoT) looks set to spur ever more increasing use of electronics in automobiles, and in industrial and consumer products. However, it's a highly competitive field and Maxim comes up against far larger semiconductor companies like Analog Devices and Texas Instruments -- a concern in a highly cyclical industry where scale is so important.

Meanwhile, Eaton Vance is an investment asset manager -- a great business to be in when the markets are in good shape and assets under management are expanding. However, Eaton Vance's management fees will always be subject to the underlying performance of equity and fixed income markets -- nearly half of its management fees come from assets under management held in equities.

Eaton is also a somewhat cyclical company, but it has a relatively diverse collection of end markets ranging from utilities, trucks, and aerospace to industrial factories, data centers, and construction. In fact, Eaton's lower risk profile is reflected in the following metrics.

The standard deviation of monthly returns is simply a mathematical representation of how much a stock's monthly return tends to vary from its average. A lower number is better, as it implies the stock is less volatile. As you can see below, Eaton's is significantly lower than the others.

In addition, I've included the "Sharpe ratio," which simply takes returns generated in excess of a risk-free rate and then divides it by standard deviation -- a higher number is better. From this you can measure whether a company is making its returns through being more risky.Again, Eaton scores relatively well.

MXIM Historical Sharpe Ratio (10Y) data by YCharts

There's a reason why Eaton has done so well, and that comes down to operational improvements over the years. In a nutshell,a series of restructuring actions and acquisitions have significantly improved its margin and free cash flow generation in the last decade.

ETN Operating Margin (TTM) data by YCharts

Indeed, management expects to generate some $8 billion in free cash flow between 2019-2021, a figure representing around 20% of the current market cap with low-single-digit growth in revenue and earnings. After dividend payments of $3.5 billion, Eaton should have around $4.5 billion of cash available (around 11% of its current market cap) with which to make share repurchases or acquisitions -- another source of earnings growth potential.

Not only was Eaton the best retirement stock for investors in 2019, but it also has plenty of potential to do well for investors in the coming years. The dividend is very well covered and the company's cash flow generation, ongoing restructuring, and relatively diverse end markets suggest it can grow its dividend for many years to come.

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