December 22, 2011

Would Your Financial Plan Survive You?

One of the realities of married life is that one spouse is usually more focused on the couple’s financial and retirement planning than the other. This can create a situation where one member of a couple has little knowledge of their joint financial plan. In that situation, if the primary financial planner of a given couple should pass away, the surviving member will not know how to handle their finances. Regardless of which partner assumes the lead financial role, part of his or her responsibility is ensuring that their joint financial plan doesn’t unravel when the inevitable occurs.

One of the realities of married life is that one spouse is usually more focused on the couple’s financial and retirement planning than the other. This can create a situation where one member of a couple has little knowledge of their joint financial plan. In that situation, if the primary financial planner of a given couple should pass away, the surviving member will not know how to handle their finances. Regardless of which partner assumes the lead financial role, part of his or her responsibility is ensuring that their joint financial plan doesn’t unravel when the inevitable occurs.

If you are the primary financial planner and have a spouse that is less interested in and knowledgeable about such matters, there may be some modifications that you can make to your portfolio to help your spouse in the event of your death. In a general sense, the portfolio might be simplified. If you have taken a very active hand in your investments but feel that your partner may not want to do so, you might consider modifying your investments portfolio so that it will require less maintenance.

A financial advisor can help you examine your financial plan for retirement and make modifications to protect your spouse in the event of your passing. Feel free to contact your Raymond James Retirement Coach to help determine the best options for your particular situation.

Source: "Would Your Financial Plan Survive You?" WorthWhile. Fall, 2011: p12-14.

December 20, 2011

What if you live to age 100?

If you have made it to your retirement, congratulations! Retirement represents an important transition, but did you know that there is a good chance that a person who has reached their retirement still has a third of their life remaining? People today are living much longer than previous generations; in fact, the U.S. Census Bureau suggests that there could be as many as four million Americans aged 100 or more by the year 2050. With lifespan increasing, now is a good time to determine if you have planned adequately for the possibility of one day celebrating a birthday with two zeros.

Here are some things to consider when planning for a long retirement:

Create a retirement income: Creating a reliable income stream is one of the primary challenges of retirement planning. Typically, your retirement income will be generated by multiple sources including Social Security, a pension plan, IRAs, and stocks and bonds. From this income, a withdrawal rate that will not deplete your savings too quickly must me determined. A financial planner can help you arrive at a withdrawal rate that’s right for you.

Start off on the right track: One of the best ways to help ensure you’ll have enough money in the later years of retirement is to be very careful in the early years. It’s understandable to want to celebrate your retirement by splurging in some way, but this is also dangerous. It’s important to follow a financial plan in retirement. Don’t make purchases without considering how it will impact your long-term retirement income.

Plan for long-term care: According to the Department of Health and Human Services, nearly two-thirds of those over 65 will need long-term care services of some kind in their lifetimes. The median cost of a private room in a nursing home was about $205 a day. One option for dealing with the possibility of this expense is purchasing long-term care insurance, or a hybrid policy that combines life insurance and long-term care insurance.

A financial advisor can help you examine your financial plan for retirement and make modifications to better position you for a long and happy retirement. Feel free to contact your Raymond James Retirement Coach to help determine the best options for your particular situation.

Source: Source: "What If You Live to 100?" WorthWhile. Fall, 2011: p17-21.