Retirement used to be something everyone looked forward to. A retirement party, a nice watch from your soon-to-be former employer and then home to an open schedule and a slightly smaller check. It was a “no brainer.”
As long as your smaller income covered your spending, the only other real planning was finding a hobby. Retirement was nearly as perfect as it looked in the advertisements.
Today, this isn’t the reality for most retirees. Investing and advice associated with retirement has changed. Financial planning for retirement is no longer reserved as a hobby for the well-to-do. It is a realm that is important to everyone as retirement rests more on the shoulders of you, the employee, instead of your employer.
As you start to think about your retirement readiness, join us at this year’s SWIRCA Boomer Bootcamp to discuss areas that often go overlooked by retirees. This year’s event will be on November 17th at 6p.m. For more details on other speakers and location click here.
Retirement Planning has Changed as Much as Retirement Itself
Here are a few ways retirement has changed.
Old Way: Once I reach 27 years of service, my pension benefit will last until I die.
New Way: Understanding my current spending habits, once I have saved [my specific amount for my lifestyle], I can replace 90% of my income until age 95.
Old Way: My pension benefit has a Cost of Living Adjustment (COLA).
New Way: I have tested my plan to understand the impact that various levels of inflation will have on the longevity of my retirement nest egg.
Old Way: My pension benefit is taxable.
New Way: Through my savings, I have created various “tax buckets” so that all my withdrawals are not 100% subject to taxes.
Old Way: Aside from my pension, I invest in a few smaller companies. Maybe they will be huge windfalls.
New Way: Understanding my tolerance for risk, my portfolio is diversified to minimize risk, but also allow exposure to growth opportunities.
Old Way: If another financial crisis occurs in the year I decide to retire, at least I still have my pension.
New Way: If I experience poor market returns in the early years of retirement, I know how much I have to decrease my spending to protect the longevity of my portfolio.
Old Way: I work with an adviser who helps me identify investment opportunities.
New Way: I work with an adviser who considers my entire financial picture and helps me understand my level of financial security for several personal financial goals.
Learn More About Retirement Finances at Boomer Boot Camp
The smallest considerations can lead to a few extra years of financial security. Even if you are already in the process of saving for retirement, you will benefit from learning more about how to plan. There are newer tax laws and investment options every year, so it is in the best interest of you and your family to stay informed.
Join us at this year’s SWIRCA Boomer Bootcamp to help avoid the risks of retirement without a good financial plan.
This year’s event will be on Thursday, November 17th at 6 p.m. For more details on other speakers and location click here.
Date Published: November 2, 2016
Author: Chad R. McPherson
Phone: (812) 602-5980