retirement planning

Take Control for a Better Retirement

A solid retirement plan is about much more than a collection of investments and insurance products. Be organized about your approach. Here’s how.

If the past year has taught us anything, it is that so many things in life feel “out of our control.”  The COVID pandemic certainly has dominated life for the past 16 months. However, stock market volatility, unpredictable weather in all parts of the country, social unrest and a political climate like we’ve never seen before are just a few things that have made life for many more uncertain than ever.

For those preparing for or already in retirement, this can seem even more pronounced.  You work hard for many years and begin dreaming of the possibilities for this next phase of life, all while watching things around us happen without much clarity or certainly.  Not knowing how the events of today will positively or negatively impact retirement, can be a significant source of stress and worry for those not properly prepared.

It’s more important that, while you dream of the freedom and independence that retirement could bring, you stay focused on three things you can control.  I call them the three P’s of your retirement: Philosophy, Process and Planning.

Philosophy

Take time to reflect and understand your own philosophy about what your financial life will be about during those golden years.  If you’ve been a diligent saver and good steward with money, will life just be about having an uncoordinated basket of investment or insurance products, hoping they will grow enough to last long into the future?  Will you continue to have an investment-only focus, where happiness in retirement will be dependent primarily on positive market returns?

 Compare that to having a mindset focused on retirement strategies such as preservation, distribution and coordination.  Don’t get trapped into a belief that your investments, no matter how much you have saved, are a RETIREMENT PLAN.  Make sure your philosophy is about being comprehensive and holistic when considering all areas of your financial life. 

Process

Now that you have begun to shift your mindset from one of “accumulation” to that of “distribution and preservation,” it’s time to determine what your process (or your financial adviser’s process) will be to implement retirement strategies that will help mitigate all types of financial risks as we age. 

Designing your retirement “blueprint” should not feel overwhelming, complicated or confusing.  Trying to design and implement strategies for all areas of our retirement, such as income, tax, health care and estate planning, can be intimidating and cause us to avoid having the right conversations.  Quite often, it leads us back to focusing only on those things we feel comfortable with, such as our investment accounts and fixating on the market.

The process for creating your plan should be systematic, go step by step, brick by brick, addressing each of these areas one at a time. This will seem so much less intimidating and increase the likelihood you will keep your focus of having a comprehensive, holistic and coordinated retirement. 

Planning

No matter how systematic your process, the planning you do should be retirement “specific” and “customized” to you.  Do not settle for using generic retirement rules and outdated advice.  Realize that accumulating your wealth is significantly different than preserving and distributing your wealth. Many areas of your financial life go from being “automatic” or “set it and forget it,” such as investing or creating monthly income, to needing a more active approach. 

Something as popular as  the  4% rule, which came to be in the early 1990s as a suggestion for the best way to make your money last throughout retirement, is no longer applicable and just a lazy approach to creating retirement income. 

Other common considerations and decisions that need to be customized to you and not generic  are things such as:

  • When to begin Social Security benefits.
  • Roth conversions.
  • Using tools properly, such as annuities and life insurance.
  • Establishing an estate plan that accounts for many of the “what ifs” in life.

 Too many considerations about retirement to list here should be customized and specific to give you the best opportunity to live the retirement you want to live.

As the world we live in continues to feel out of control, take a deep breath, a few steps back, and focus on these 3 P’s for an AMAZING RETIREMENT!

About the Author

Nicholas J. Toman, CFP®

Certified Financial Planner & Retirement Planning Specialist, Empowered Financial Management

Nicholas Toman, CFP®, is a lead retirement planner and investment adviser with Empowered Financial Management, a firm that specializes in retirement planning for those individuals within five to seven years of retirement or who have recently retired and no longer wish to serve as their own financial adviser. Nicholas is a graduate of the University of Wisconsin-Whitewater with a BBA in accounting and has been a Certified Financial Planner since 2014.

Investment Advisory Services offered through BCJ Capital Management LLC, an (SEC) Registered Investment Adviser.  Information presented is for educational purposes only. It should not be considered specific investment advice, does not take into consideration your specific situation, and does not intend to make an offer or solicitation for the sale or purchase of any securities or investment strategies. Investments involve risk and are not guaranteed, and past performance is no guarantee of future results. For specific tax advice on any strategy, consult with a qualified tax professional before implementing any strategy discussed herein.

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
Will Monthly Child Tax Credit Payments Lower Your Tax Refund or Raise Your Tax Bill?
Tax Breaks

Will Monthly Child Tax Credit Payments Lower Your Tax Refund or Raise Your Tax Bill?

Everyone loves receiving large sums of money from Uncle Sam. But people who take advance child tax payments may take a hit on next year's tax refund.
July 31, 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
Capital Gains Eating into Your Investments?
capital gains tax

Capital Gains Eating into Your Investments?

Choosing the right types of funds to own and carefully timing when you buy and sell them can make all the difference in a tax-efficient portfolio, hel…
August 4, 2021
On National Chocolate Chip Cookie Day, a Lesson in Life from Mrs. Fields
personal finance

On National Chocolate Chip Cookie Day, a Lesson in Life from Mrs. Fields

A humbling moment that we can all relate to put the future cookie queen on her entrepreneurial path. If Mrs. Fields could turn a humiliating foible ar…
August 4, 2021
I Sold My Business … Now What?
small business

I Sold My Business … Now What?

The rich cash infusion that comes from selling a business can create a liquidity conundrum that's a challenge to manage.
August 3, 2021