Here are several excerpts from an article that discusses some smart insights from several professional financial advisors who pulled this content together for Kiplinger online. It’s well worth a read.
The Retirement Planning Bases You Need to Cover
If you’re in or nearing retirement, you should be seeking advice regarding:
- Transitioning your investments. Yes, you’re still going to require investment help. No shocker there. But in retirement, remember, instead of putting money into your accounts, you’re going to be taking it out. If you don’t adjust your investing style to better protect your nest egg — and shift from accumulation to preservation — one bad year in the market could mean a devastating loss that will affect the rest of your retirement years.
- Creating a written income plan. You’re going to have to generate your own paycheck in retirement, and that means putting together a stable income that lasts as long as you do and grows throughout time. That’s a very different goal than going for all-out growth, and it can take a different set of tools. You may find that along with Social Security and a pension, insurance products are required to get the predictable income you need.
- Working on tax efficiency. Taxes can be one of the biggest threats to your nest egg — especially if you’ve done a good job of saving in a tax-deferred account (a 401(k), IRA, 403(b), etc.). You have a future financial obligation that may have a dramatic impact on your post-retirement planning. Don’t confuse tax preparation (which is all about reducing your tax costs in the current year) with tax planning (which can help you hold onto your hard-earned money year after year).
- Preparing for health care costs and the possibility you’ll need long-term care. When you retire, you’ll likely lose the health benefits offered by your employer. If you retire before you turn 65, you’ll need to figure out coverage until you qualify for Medicare. When you’re eligible for Medicare, you’ll need help again, assessing how various plans can best meet your needs.
- Protecting your legacy. Most people want their assets to be distributed to their loved ones quickly, easily and privately after they’re gone. They would prefer to leave as little to the IRS as possible.