Purpose of Retirement Planning
When it comes to your financial life cycle, retirement is one of the most important and strenuous areas to plan for. Because of the reduction in income during retirement, a person is exposed to longevity risk (risk of outliving your money) and the risk of not being able to maintain your current or wanted lifestyle. Our Red River Wealth Management team has analyzed your financial information and goals to create the retirement recommendations listed below.
Areas of Improvement/Concern
Upon reviewing your goals and financial information, we are concerned with your exposure to longevity risk. If you continue on the path you are on now and try to reach each goal on your own, you will outlive your money. Along with the recommendations listed below, we believe it would be beneficial to save more in your brokerage account. These savings can come from cutting back on expenses as well as your surplus saved each year.
Explanation of Common Terms
Your average return is the average of all the returns on your investment over a certain period of time. This could be a monthly average return, yearly average return, all of retirement average return, etc.
Bad timing means that the markets are behaving poorly whether at the time of investment or sometime within the plan. This could be due to economic, social, political, environmental, or other conditions.
Retirement Goals
You expressed, in our introductory meeting, that Arthur would like to retire at the age of 67 and Martha would like to retire at the age of 64; however, you are somewhat willing to retire later if necessary to attain your goals. You also wish to maintain your current lifestyle, with a few changes in housing, travel, and vehicles. Base...
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A reverse mortgage is a loan for age 62 and older to use the equity in their home as a supplement for income. This loan is not paid off until you move out of your home or pass away. This type of mortgage is a great resource for those who need the extra cash in their daily lives; however, we would not recommend a reverse mortgage for your situation. There is a high probability that you can maintain your lifestyle and accomplish your goals without the risk of a reverse mortgage. However, if a need does arise and extra funds are needed, we can revisit this topic and see if it is necessary.
Resulting Probability to meet goals
If you choose to follow our recommendations, you will increase your probability of success from 33% to 84% which is within the Confidence Zone. Your probability of success is discussed in detail in the Investment section of this plan.
An ad placed by Damon Investment Company is claiming a 21% return on their mutual fund of speculative stocks.
The push for Congress to pass legislation protecting the rights of employees and their retirement was inevitable. Retirement plans are extremely important for all working individuals. Having funds to keep or exceed ones current standard of living and to enjoy one’s life beyond expectations after retire...
Through the years, people age and become less productive. For these reasons, they have to prepare some plans that help them secure their own future. But, there are instances that lead an individual to an early retirement. Some lack motivation and enthusiasm in their work. Others are not capable of working anymore as well because of the health issues that they are facing. Regardless of the reason, it is important that one has to work so that by the time they retire, they will not end up broke. Having this in mind, many people are already investing in a simple IRA.
You might be tempted to dip into your retirement fund for a major purchase, find the will to resist. You’ll pay extra fees and taxes, and you are robbing your future self. If you leave it alone, your money will continue to grow year after year. Your gains can be reinvested and you’ll earn more than you would have with just a small chunk of
Mrs. Nancy Hamilton (changed name for privacy) is 95 years old female who resides in a local continued care retirement community (CCRC) located in the Los Angeles County. I decided to interview Mrs. Hamilton for her successful aging. I have known her for 9 years and her aging process has not been an easy ride but she always maintained a positive sprit that kept her going even today. Mrs. Hamilton moved in to a CCRC in 2006, two years after her husband passed away. Mrs. Hamilton has one daughter and one son. Daughter Margaret lives nearby and visits frequently and takes care of personally needs such as transportation to medical appointments or shopping for skin care products or clothes as necessary. Son, David lives in the Northern California and visits a few times a year.
Pension provides an income when people have stopped working. Also, it provides important forms of insurance against long life, prices, relative benefit drops and savings shocks. As well as it is an important benefactor to the financial security of a majority of Australian men and women of retirement age, with about 70 per cent of people of pension age receiving the Age Pension (Australia and Treasury, 2015). The government can provide this type of insurance for less than it costs individuals to insure themselves by sharing long life risk, and hedging the
Social Security is on the verge of taking care of the baby boomers generation. This means that it will be paying more benefits than taxes it receives. In lay-man’s terms it means it will be spending more money than it is making. I think that you should pay into your own private retirement account for you to reap the benefits in the future. Not for you to pay into a cluster of workers money for current elders to benefit from. You need to take care of your own future and not rely on other people’s responsibility. “…people began to think retirement funding as a right…and so…started saving less” (Klay & Steen). That being said, people of a certain age should be “grandfathered” into this meaning, people of the age of say 40, still get the normal social security retirement money but anyone younger must start abiding this new reform. If you get married, keep paying into your own unless your spouse is not working. If that is the case then pay the same amount BUT put half into your own and half into your spouses. If the other spouse is working however, they should pay into their own account and you into your own.
However, there is no doubt that this method can work but there is one important aspect to look at. Time. It is the most important factor everyone is cautious of and if well managed, produces great results and provides even more time. Looking at this example Larry Light gave in his article, if you withdraw 4% of your retirement savings for 30 years, there is a high chance you would outlive your money. But most importantly is how you time your retirement. Time is a very important key factor to everything we do in our day to day activities. According to the teaching of the assistant pastor of United Charismatic healing ministry, Pastor Amos Ayitei, he says “if you don’t use time wisely it is obvious that time will use you”.
A Reverse mortgage is a special type of loan for seniors 62 or above, that lets you convert a part of equity in your home into usable cash. Borrowers do not need to repay the loan if the home is their primary residence and they meet the obligations of a reverse mortgage. Most reverse mortgages are provided by the Federal housing administration (FHA), as part of its home equity conversion mortgage (HCEM) program.
At the beginning of a project people planed ahead to warranty that they will fulfill the project. They create a plan, a budget, and maybe some research in order to have the best results on the project. For somebody that is thinking in retirement the same must apply but the problems that they mostly faced are age, social security benefits and finances.
But what they don’t tell you is how many picks were wrong and turned in to huge losses. Our newsletter is base hit investing. Think how quick you can grow an account when you make 3-7% every month, reinvesting those earnings.
Allers, Kimberly Seals. "How Fit Are Your Finances?" Ebony 68.9 (2013): 93-97. Academic Search Complete. Web. 15 Nov. 2013. Bauer, Gabrielle, and John Southerst. "A promising retirement: your life, your way." Maclean's 18 Feb. 2013: 37+. Opposing Viewpoints in Context. Web. 15 Nov. 2013.
Personal financial planning eventually leads to secured retirement years; this is the purpose to plan for the future. With a volatile and erratic economy, and social security benefits undetermined in regards to having enough money to comfortably survive after retirement is critical. There is no magic ball to tell us what the coming years will bring; this is why it is up to each individual to have their own financial lives under control. Having a concrete financial plan now will secure an increased comfortable future.
Rappaport, Anna M. "Retirement Risks And Solutions In The Middle Market." Journal Of Financial Service Professionals 66.1 (2012): 45-55. Business Source Premier. Web. 25 Oct. 2013.
Lots of working people are scared when comes planning for their retirement day, as well as there are some of them are confident to face theirs restful years. This people who fear with their retired age are the person whose are lack of knowledge about financial matters so they will ignore their planning for retirement as long as they can. The effect is, they will try to continue to work as long as they can work. Recently, the Ministry of Human Resource’s Malaysia, increase the retirement age to 60 years old for government sectors. As Hunt (2009) state that Malaysian confident for their retirement have decrease rapidly in some way. According to Lai Cheng Tung & Jean Dennis Comeau (2012) the people who agree with the new retirement age as they claim that they required more retirement savings, increasing retirement age will increase the life expectancy, and this provide retention of talent or improving skill proficiency especially in expert job that need longer years of experience to master it. To support more agreeableness in increasing retirement age, based from Life Insurance Association of Malaysia (LIAM), 5% and less than that percent are prepared completely for their retirement (Habib, 2007). All of the statement showed that Malaysian are still good enough to continue working even most of them are lately around 60’s as a period for preparing themselves before retired.