Retirement Guys: How to not outlive your moneyWritten by Nolan Baker Mark Clair | | firstname.lastname@example.org
When folks come to in see The Retirement Guys we always ask what the biggest concerns are. Nine times out of ten the top concern is “I don’t want to outlive my money. I want to have enough to live comfortably the rest of my life.” Isn’t that part of what we are all working for? Security, and the idea of not worrying too much about the future in order to have better quality of life today.
The Retirement Guys understand that when you are approaching or are in retirement time, it becomes a whole new ball game. I (Mark) am a big sports fan, so I tend to relate to concepts from a sports point of view. When you are competing in a sports contest it is vital to understand what the rules are to increase the likelihood of winning the game. Retirement is “a whole new ballgame” and comes with a new set of rules and guidelines. The key to success comes from knowing the new rules and how to work them to your advantage.
The Retirement Guys have created what we call The Retirement Game Plan. What is it? A process that can guide you through retirement planning. A set of planning steps that can help you understand the new rules, draw your attention to things that you should think about, and provide you action steps to take to have a better chance at a happy and relaxing retirement.
The Retirement Game Plan consists of three main categories:
- Manage Your Money
- Preserve Your Assets
- Efficiently Plan Your Estate
Manage Your Money – Obviously, we all need money to live.
If we are no longer earning money we need to make sure we have enough income to live well in retirement time. The key component here is what we call The Independent Income System. Placing money into different categories based upon time frames, risk tolerance and the current need for income. Using tools like circuit breakers to help limit declines in account values should the stock market drop drastically. It is important that you have enough money and it will be there when you need it. You may want to ask yourself these questions: “Where is my income going to come from? Am I prepared for the next stock market crash? How will this affect my financial security?”
Preserve Your Assets – Now that we have your money placed in various categories, what could severely damage your nest egg potentially causing you to run out too soon? A couple things come to mind and they both relate to health. One is the lack of the understanding of health care costs during retirement. Most people don’t know that Medicare is mandatory and is not free. In addition to the cost of Medicare is the cost of what Medicare does not pay for like deductibles, co-pays, etc. It can be a rude awakening when you realize how much will come out of your pocket to pay for health care. Second very real possibility, is an unexpected long-term health care crisis. When you are no longer able to care for yourself, who will do it and who will pay for it? If you are paying for it, the possibility of running out of money becomes much more likely and it can happen very quickly if you don’t plan ahead.
Efficiently Plan Your Estate – This is an area that typically benefits someone else. Typically your children or whoever you choose to leave your estate to. If you don’t end up needing all of your money and other assets, the goal is to leave it to our loved ones instead of lawyers or Uncle Sam. But pause for a second and ask yourself this question: If you are married and one of you passes away unexpectedly, how much income will you lose? Typically expenses don’t really go down that much when the first spouse dies. The least amount of lost income is typically the lower of the two Social Security checks. Do the math. If it is $1,000/month, 1,000 times 12 equals $12,000 per year. Now multiply that by how many years you plan to live. It can be a huge chunk of change. We like to plan so the surviving spouse will not lose ANY income. When it comes to passing on your estate later, what kind of plan to do depends on how strong your desire is to maximize what gets passed on. You might need to decide between a will or some kind of trust.
You can get a summary of The Retirement Guys Game Plan by going to www.retirementguysnetwork.com and sending us an email. We will send it right out to you. The key is taking action. If you don’t want to outlive your money, take some action steps right away.
For more information about The Retirement Guys, tune in every Saturday at 1 PM on 1370 WSPD or visit www.retirementguysradio.com. Securities and Investment Advisory Services are offered through NEXT Financial Group Inc., Member FINRA / SIPC. NEXT Financial Group, Inc. does not provide tax or legal advice. The Retirement Guys are not an affiliate of NEXT Financial Group. The office is at 1700 Woodlands Drive, Suite 100, Maumee, OH 43537. 419-842-0550