The closer you get to retirement your focus begins to shift from saving money to spending money.
Deciding how to spend assets in retirement presents its own set of unique challenges.
These challenges need not disrupt your financial future as long as you have a plan.
Everyday trade-offs and competing priorities
Lifestyle preferences can derail financial goals. Short-term decisions affect long-term outcomes.
We analyze your spending plan to discover if you will outlive your money or if your money will outlive you.
What happens when you need to choose between two financial goals? We build models showing what retirement might look like under different conditions. Having this information helps you make better decisions.
Thinking you will live on less in retirement than you do while working can be a big mistake.
Retiring on 70 to 80-percent of your current income is one of those “rule-of-thumbs” that can get you into trouble. For some this may be true, for others it’s not. Which is it for you?
When you retire you have more time. Unless your idea of retirement is staying at home all day, your new “free time” allows for other things. These “things” typically cost money.
Do you want to know how much you can spend in retirement without overdoing it? We show you how different amounts of spending in retirement affects your savings over the years.
Don’t wait to feel better about your finances. We give you confidence by making informed decisions.
How should you be investing when in retirement?
Investing to grow your money before retirement needs a different approach than investing to preserve your money while in retirement.
The ups and downs of the market (also known as volatility) matters very little when you have plenty of time before retirement.
When nearing retirement or beginning retirement, volatility can have lasting affects on your money.
However, changing the way you invest to avoid volatility opens the door to a different type of risk… inflationary risk.
Developing an investment strategy to balance these risks becomes challenging. It also poses the question “how should you be withdrawing money from your retirement savings during volatile times in the market?”
How you decide to do this can have long term effects on your total wealth.
We help develop a retirement plan that adjusts for changing market conditions.
We help you understand how much risk you should be taking and what it means to you when the markets move up and down in retirement.
We show you how inflation can slowly hurt your retirement and what to do about it.
All of my money in savings, investing, and retirement accounts spend the same.
There’s a term called “asset location”. It’s not to be confused with “asset allocation”.
Asset location is about tax liabilities. The choice to spend money from your savings accounts, individual or joint accounts, IRA accounts, Roth IRA accounts, or other qualified accounts such as 401k, 403b, or 457 accounts creates a different tax liability for you.
Which type of account should you spend from first? Which type of account is better for a lump sum purchase in retirement? Which type of account should you spend from last?
We show you how spending from one account over another can create a better outcome depending on your goals.
A great risk to have in retirement
Dying isn’t the biggest risk retirees face, living too long might be your biggest problem. This is a great problem to have… provided you don’t overspend your retirement savings.
Social Security’s Actuarial Life Table tell us the life expectancy of a male who has reached age 65 is another 17 and-a-half years. For females reaching age 65 life expectancy is another 20 years.
The probability of dying within one year when reaching age 65 is 1.5-percent for males and just shy of 1-percent for females.
More Centenarians (people age 100 and older) are alive today than in the past. The 2010 Census Special Report on Centenarians shows 32,194 centenarians alive in 1980. That number increased to 53,364 in 2010.
Centenarians make up a greater proportion of our population today than in the past. In 1980 Centenarians accounted for 1.42-percent of the population. In 2010 they accounted for 1.7-percent of the population.
Another interesting fact from the report is 77-percent of males age 100 an older lived alone or with others in a household. Sixty three percent of females age 100 an older lived alone or with others in a household
These figures prove retiring is different today than it was for your parents. You should expect to be active in your 60’s, 70’s, and for some, even into your 80’s.
Do you have a plan for living longer than expected? We help analyze how things might turn out based on different life expectancies.
Underspending your money in retirement
You’ve worked hard and are in the habit of saving money. It’s easy to continue this habit and become too frugal in retirement.
Wouldn’t you want to know if you could spend more of your money in retirement rather than worrying that you might be spending too much?
A good retirement plan gives you the confidence to spend your money and enjoy your retirement lifestyle without worrying about how much you should, or shouldn’t, be spending.
When should I take Social Security Retirement benefits?
This is an important question and it does matter how you take your benefits. Choosing one way over another can cost $100,000’s over your lifetime.
We’ll look at your options and share the pros and cons of taking benefits early, later, or using other advanced strategies.
What about your pension options from work?
This can be a confusing and costly decision. Not only for you but for a surviving spouse.
We take the guesswork out of choosing your pension options.
What’s your plan for transferring wealth to your loved ones?
If you do not have a Will in place the State will make one for you.
Why would you leave such an important decision without any directions?
You might have an idea or two about how you prefer your money to be given to your loved ones. Unless you have the necessary Estate Planning documents, your wishes may not come to pass.
We can help you get your Estate Planning documents in order. A good financial plan covers the uses of Wills, Advanced Directives, Power of Attorney, Trusts, and other documents.
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