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.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
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!
Disclaimer
Investment Advisory Services offered through Trek Financial, LLC, (Trek) 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. Trek 21-115.
To continue reading this article
please register for free
This is different from signing in to your print subscription
Why am I seeing this? Find out more here
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.
-
Stock Market Today: Nasdaq Soars Ahead of Tesla Earnings
The EV stock rose nearly 2% ahead of its highly anticipated Q1 earnings report, due after tonight's close.
By Karee Venema Published
-
GM Stock Accelerates After Earnings Beat
General Motors beat expectations for the first quarter and raised its outlook for the year. Here's what you need to know.
By Joey Solitro Published
-
Four Tips to Make Your Sales Presentation a Winner
Being prepared and not being boring can go a long way toward persuading a potential customer to buy into what you’re offering.
By H. Dennis Beaver, Esq. Published
-
Pros and Cons of Waiting Until 70 to Claim Social Security
Waiting until 70 to file for Social Security benefits comes with a higher check, but there could be financial consequences to consider for you and your family.
By Patrick M. Simasko, J.D. Published
-
Now Could Be Time for Private Investors to Make Their Mark
The venture capital crunch may be easing, but it isn't over yet. That means there could be direct investment opportunities for private deal investors.
By Thomas Ruggie, ChFC®, CFP® Published
-
How to Stop Boredom From Ruining Your Happy Retirement
Retirees who explore new interests and have an active social life are more likely to find joy — and even greatness — in the newfound freedom of retirement.
By Richard P. Himmer, PhD Published
-
The Life-or-Death Answers We Owe Our Loved Ones
How our life ends isn’t always up to us, but that question too often must be answered by loved ones and health care workers who don’t know what we would want.
By Joel Theisen, RN Published
-
Hot Tips for Home Buyers and Sellers Right Now
Real estate looks to be especially hopping this spring, thanks to pent-up demand and buyers adjusting to higher mortgage rates. Here’s how you can prepare.
By Pam Krueger Published
-
Is 100 the New 70?
Eating well, exercising, getting plenty of sleep and managing chronic stress can help make you a SuperAger. Funding that long life requires longevity literacy.
By Phil Wright, Certified Fund Specialist Published
-
Nine Lessons to Be Learned From the Hilton Family Trust Contest
Disclaimers, good communication, post-marital agreements and more could help avoid conflict in a family after the owners of a wealthy estate pass away.
By John M. Goralka Published