When planning for retirement, financial planners will typically ask you about your goals, especially your retirement goals. Common goals include traveling, covering all healthcare costs and not running out of money.

Some are one-time goals and some are recurring. Quantify your objectives, be conservative in your assumptions and make sure you consider inflation. A financial professional can guide you through this very important part of the process.

Retirees are often concerned about running out of money. This can happen when retirees withdraw too much from their accounts. A good rule of thumb is to keep the amount of your annual withdrawals below 4% of your investment balances. 
This is a general rule. Factors such as age, life expectancy, income, investment performance, and others should be considered. A financial advisor should be involved in this process.  

Take a minute to think about who you currently have listed as beneficiaries on your life insurance policies, retirement accounts, and annuities. Better yet, log in or take a look at the actual documents to confirm they’re still the right people to receive those assets if something happens to you.
 
All too often, people unintentionally leave money to the wrong person - like an ex-spouse or even someone who has passed away—because beneficiary designations don’t automatically update when life changes . A quick review after major life events, both in your life and in theirs, can ensure your assets go exactly where you intend and help maximize the legacy you leave behind.

Many clients ask us when they should include their children in their financial and estate planning conversations.  The answer is that someone needs to be in-the-know.  There are many reasons to include someone in the conversation sooner rather than later. 

Have a conversation with your financial advisor or estate attorney about this subject. Ask them if and when they believe you should have a “family meeting” with a trusted family member or contact, and what information should be shared.  

You do not have to share financial figures, but you would want them to know a bit about your estate plan, where documents can be found, and other directions should something happen to you.

Down the road, you’ll be glad that you were proactive.

As financial advisors, we see firsthand the impact age has on one’s life. We’ve seen clients start retirement in their “Go-Go” years. They have the energy and freedom to do things like travel, volunteer, and start new hobbies.

As they grow older, they typically transition into their “Slow-Go” years, where they begin to slow down a bit and are less active than they once were. We’ve seen their travel plans become less frequent.  Travel is not over - it’s just not as often or maybe not as far.

Eventually, people typically transition into their “No-Go” years. Staying home becomes much more appealing, and their energy and motivation to get out and go are not what they used to be.

Don’t worry, you can find joy and create many memories in all three stages. Volunteering, learning, finding new hobbies, and staying social are possible in every stage.  A little advice to retirees: make the most of your Go-Go years and treasure all of your years, no matter the stage!

A surprising statistic: more than two-thirds of American adults die without a will. When that happens, the probate court decides how assets are distributed — typically according to state law, not your personal wishes.
Even if you do have a valid will, your estate will likely still go through probate unless you’ve also put other planning tools in place, such as a revocable living trust.
A revocable living trust can help your family avoid probate and, perhaps just as importantly, maintain privacy during the process. Talk with an estate planning attorney to see if a revocable living trust makes sense for you.

Step-up in basis is a valuable tax consideration in estate planning. When beneficiaries inherit taxable assets, they receive them with a stepped-up basis, which often eliminates capital gains taxes on any appreciation that occurred before inheritance. This means that holding appreciated assets in taxable accounts can be advantageous to beneficiaries, since they can potentially sell these assets without incurring significant capital gains taxes.

Sequence of returns risk is the potential for poor market performance early in retirement, combined with ongoing portfolio withdrawals during those years. It can significantly deplete one’s portfolio more quickly, lock in losses, and diminish the portfolio’s recovery potential, even when markets rebound later. This risk increases the chance of running out of money later in life. Make sure that this risk is being addressed in your plan for retirement with proper withdrawal rates, diversification, flexibility, and adequate cash reserves.

*All investing involves risk including loss of principal. No strategy assures success or protects against loss. There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk

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Let’s do some simple math. Assume that you have $100,000 in your retirement account at the beginning of last year, and your account went up 50% last year. Now, let’s assume your account has fallen 50% this year-to-date. Is your account up or down since the beginning of last year?

 
Many people would say their account is breakeven – still valued at $100,000. But, that would be incorrect – your account would be down 25% valued at $75,000. Understanding how your account is positioned, the amount of risk you are comfortable taking, your goals, and when you will need access to your money are some of the most important factors you should know as the owner of your account – your money.

Unexpected events, such as health issues or economic downturns, can impact your retirement plans. Confirm that you have developed contingency plans, including emergency funds, insurance coverage, and flexible investment strategies, to mitigate potential risks.

Many New Year's resolutions involve getting in shape and reducing stress. While people often associate this with physical health, it is also true of financial health. The best way to get financially fit is to meet with a financial planner and make a plan! Once you have a plan with actionable goals, and someone to counsel you along the way, you will be off to a great start! So this year, let's pledge to improve our physical and our financial well-being.

 
 
Most of us are really looking forward to a new year. It is a time to move on from the past year and look to the future with hope and optimism. You may have formed some good new habits along the way. In this new year, try to avoid temptations that tend to make our lives harder in the long run. For example, unhealthy eating habits or frivolous spending habits. If you have formed some good new habits, keep it up. If you have not, it is a perfect time to do so!

Minimizing tax liabilities can significantly impact retirement savings. Work with an advisor to implement tax-efficient strategies, such as Roth conversions, strategic withdrawals, and asset location planning, that seek to maximize after-tax income during retirement.

Relying solely on one source of income in retirement, such as Social Security, can be risky. Make sure you have a comprehensive strategy for retirement income from multiple income streams, including retirement accounts, pensions, and investment portfolios, to help provide financial stability. 

You may be carrying a lot of stress right now - stress from health concerns, concerns for others, and financial issues. Financial stress can lead to quick emotional decisions. When we are emotionally flooded, we become rationally challenged.

Before finalizing an important financial decision, find a quiet place, take deep breaths, and calmly consider the pros and cons of all your options.  Financial decisions need to be rational, not emotional.

If you're feeling behind on your retirement savings, consider these actions. If you are at least 50 and still working, take advantage of catch-up contributions to your retirement account. If you work longer, you will be contributing to your retirement account rather than taking money from it. Also, delaying Social Security usually leads to a higher monthly benefit. Together, these actions give you a better chance of catching up.

Studies show people tend to retire four years earlier than they originally planned. The reasons for this may include health issues, layoffs, and buyout packages. Some people retire early to take care of grandchildren or an aging parent. This information reinforces the need to seriously rethink how much you are currently saving. Consider the effect of retiring earlier-than-expected and the  impact it would have on your life