Setting
a strategy down may help you define just what you need to do.
Many people
save and invest vaguely for the future. They know they need to accumulate money for
retirement, but when it comes to how much they will need or how they will do
it, they are not quite sure. They will “wing it,” hope for the best, and see
how it goes. How do they know they are really contributing enough to their
retirement accounts? Would they feel less anxious about the future if they had
a written plan?

You can
figure out the “when” of retirement planning. When do you think you will retire and
start drawing income from your taxable and tax-advantaged accounts? At what age
do you anticipate you will start to collect Social Security? How long do you
think you will live? No, you cannot precisely know the answers to these questions
at this point – but you can make reasonable assumptions. Your assumptions may
be altered, it is true – but a good retirement plan is an evolving document,
one that can be revised with changing times.
You can set
a target monthly or annual savings rate. Once you have considered some of the “whens,”
you can move on to “how.” Assuming a conservative rate of return on your
invested assets, you can specify how much to defer into retirement accounts.
You can
decide on a risk tolerance and an investment mix that agrees with it. Ultimately, you will
invest in a way that a) makes sense for your objectives and b) makes you
comfortable. The investment mix that you decide on today may not be the one you
will favor ten years from now or even three years from now. Regular portfolio
reviews should complement the stated investment approach.
You can
think about ways to get more retirement income instead of less. Tax reduction should be
part of your retirement strategy. Think about the possibility of part of your
Social Security income being taxed. Think about tax on your Required Minimum
Distributions (RMDs) from your IRAs and employee retirement plan. What could
you do to manage, or even minimize, the income and capital gains taxes ahead of
you?
You can
tackle the medical expense question. That is, how will you fund the medical care that
you will inevitably need to greater or lesser degree someday? Should you assign
part of your savings to a special account or form of insurance for that purpose?
Retiring before 65 may mean paying for some private health insurance in the
years before Medicare eligibility.
You can
think about your legacy. While a retirement plan should not be equated with an estate plan,
the very fact of planning for your later years does make you think about some
things: where you want your money to go when you are gone; your endgame for
your company or professional practice; whether part of your accumulated wealth
should go to causes or charities.
A written
plan promotes confidence and a degree of control. A 2017 Wells Fargo/Gallup
survey determined that those with written retirement plans were nearly twice as
confident of having sufficient retirement income in the future, compared to
those with no written plan.3
If you lack a written retirement plan, talk to the financial
professional you know and trust about one. Writing it all down may make a
difference in planning for your second act.
Taylor McClish may be reached at (503) 239-3060 or Taylor.McClish@cunamutual.com
This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.
Securities sold, advisory services offered through CUNA Brokerage Services, Inc. (CBSI), member FINRA/SIPC, a registered broker/dealer and investment advisor. CBSI is under contract with the financial institution to make securities available to members. Not NCUA/NCUSIF/FDIC insured, May Lose Value, No Financial Institution Guarantee. Not a deposit of any financial institution. CUNA Brokerage Services, Inc., is a registered broker/dealer in all fifty states of the United States of America.
Taylor McClish may be reached at (503) 239-3060 or Taylor.McClish@cunamutual.com
This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.
Securities sold, advisory services offered through CUNA Brokerage Services, Inc. (CBSI), member FINRA/SIPC, a registered broker/dealer and investment advisor. CBSI is under contract with the financial institution to make securities available to members. Not NCUA/NCUSIF/FDIC insured, May Lose Value, No Financial Institution Guarantee. Not a deposit of any financial institution. CUNA Brokerage Services, Inc., is a registered broker/dealer in all fifty states of the United States of America.
Citations.
1 - kiplinger.com/article/retirement/T023-C032-S014-do-you-have-a-written-financial-plan.html
[10/25/17]
2 - aboutschwab.com/images/uploads/inline/Charles_Schwab-Modern_Wealth_Index-findings_deck.pdf
[6/17]
3 - time.com/money/4860595/how-to-retire-wealthy/ [7/18/17]
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