retirement

A Financial Professional Can Help You Avoid Retirement Blind Spots

Are you taking an appropriate amount of risk? Do you have a written retirement plan? Do you have tax strategies in place? Another set of eyes can help as you roll toward retirement.

One of the great things about being a parent is that you can learn so much from your kids. It gives you a whole new perspective, and there are takeaways you can apply to your own life.

Lately, when I’ve been out riding around town with my teenage daughter, Madison, behind the wheel, I’ve become more aware of all the things that can go wrong even if she’s doing everything right. She could be belted in, going the speed limit, staying in her lane, slowing down at yellow lights and stopping when they’re red — and still, another car could sneak up in her blind spot, cut her off and cause an accident.

When I’m with her, I feel better, of course, because there’s an experienced driver along and a second set of eyes looking out with a different view.

That’s how individuals should feel when working with a financial professional — like they have a co-pilot watching out for them and shielding them from surprises that might creep up. So, as you continue to cruise toward retirement, talk to a financial professional about the moves that could help you avoid financial blind spots, including:

Maneuvering away from risk in retirement

It sometimes feels as though everybody has forgotten about what happened in 2008, when investors were going along, feeling fine, and then the market plummeted.

Afterward, financial professionals told their clients: “Don’t worry. Stay in it. The market comes back.” And it does … eventually. In my experience, it seems to take the market an average of about six years to get back to where it was.

If you’re getting ready to retire or if you retired recently, an unexpected downturn could damage your life savings — and if you’re pulling income from your portfolio, it could be very difficult to build it back up.

What percentage of your retirement savings are you willing to have exposed to risk? Make sure you and your spouse agree on that amount — and be confident your financial professional’s idea of “conservative” strategies is the same as yours.

Getting a written retirement plan

Sitting down and mapping out the different stages of your financial journey seems like such a simple thing, but most people don’t do it. They have a bunch of money, so they think they’ll be fine, but there’s no plan for how or when they’ll access that money or how to make sure it will last.

Especially in retirement, it’s critical to be aware of the many scenarios that could boost or blow your future goals. Get your plan in writing — and update it regularly.

Protecting against taxes

You’re going to have to pay taxes, but you can be smart about it. Talk to your financial professional about how taxes can affect your financial plan and how to best time distributions, including required minimum distributions.

Don’t assume your tax bracket will go down in retirement. Tax-efficient financial strategies may make the difference between reaching and falling short of your financial goals.

Getting a second opinion

If a second set of eyes can help you avoid blind spots, imagine what a third set of eyes could do. It never hurts to get a fresh point of view on your portfolio’s possibilities. It could be your financial professional was a good fit for you when you were younger and still accumulating wealth but is less prepared to help you in retirement.

The road you know isn’t necessarily the safest or least prone to potholes. This is a great time to get an annual review from someone who is more familiar with the many routes available for you to take.

Kim Franke-Folstad contributed to this report.

Investment advisory services offered through AE Wealth Management, LLC (AEWM). AEWM and Core Financial are not affiliated entities. Investing involves risk including the potential loss of principal. Neither the firm nor its agents or representatives may give tax or legal advice. Individuals should consult with a qualified professional for guidance before making any purchasing decisions.

About the Author

Philip Gordley, Investment Adviser

President and Founder, Core Financial

Philip Gordley is an independent financial adviser in Albuquerque, N.M. The president and founder of Core Financial, he has more than 35 years of experience in the insurance and investment industry and has a bachelor's degree from Quincy College. Phil has been married for 26 years to his wife, Zora, and they have two teenage daughters.

Most Popular

25 Best Kirkland Products You Should Buy at Costco
Smart Buying

25 Best Kirkland Products You Should Buy at Costco

Many of warehouse club Costco's store-branded Kirkland Signature items get high marks for quality and value. Check out our picks.
July 21, 2021
Warning: You May Have to Pay Back Your Monthly Child Tax Credit Payments
Tax Breaks

Warning: You May Have to Pay Back Your Monthly Child Tax Credit Payments

Unlike stimulus checks, you might have to repay your monthly child tax credit payments if you get too much money from the IRS.
July 16, 2021
13 States That Tax Social Security Benefits
social security

13 States That Tax Social Security Benefits

You may have dreamed of a tax-free retirement, but if you live in these 13 states, your Social Security benefits are subject to a state tax. That's on…
July 26, 2021

Recommended

Can I Afford to Retire?
retirement planning

Can I Afford to Retire?

That fearful question is what holds many people back from taking the plunge, but a little fact-finding could give you the information you need to make…
August 4, 2021
Retiring in the Next 5 Years? Make These Five Decisions Now
retirement planning

Retiring in the Next 5 Years? Make These Five Decisions Now

These five moves could mean hundreds of thousands of dollars in extra income over the course of your retirement.
August 1, 2021
Are You Itching for an Earlier-Than-Expected Retirement?
retirement planning

Are You Itching for an Earlier-Than-Expected Retirement?

Lots of folks are pulling the rip cord on their careers sooner than they had initially planned. Before you rush to join them, make sure you are really…
July 30, 2021
How Patients with Lasting Symptoms of COVID Can Apply for Disability
Financial Planning

How Patients with Lasting Symptoms of COVID Can Apply for Disability

Those who can no longer work because of COVID-19 may qualify for these benefits but the approval process can be a difficult road.
July 30, 2021