Filling in Bubbles Won’t Always Lead to a Fulfilling Retirement

Posted: March 29, 2016
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Yes, there are essential questions you need to ask yourself before you retire. But taking an online quiz with stock questions and answers may not be the best way to help you make this important decision. Therefore, instead of calculating your score and placing you in a category with run-of-the-mill recommendations, we delve deep to find out your goals. Then we work with you to create a retirement strategy to custom suit your needs and objectives.

So with that in mind, here are some questions and data designed to help you make informed decisions.

Have you calculated how much money you’ll need in retirement -- both during the early “healthy” years and down the road when you may need more care? Be sure to consider that some large expenditures, like the money you had been setting aside for retirement, may no longer be necessary. Savings will come from other areas as well, such as lower utility bills after children move out.

[CLICK HERE to access the calculator, “Will You Have Enough to Retire?” from CNNMoney, Feb. 3, 2016.]

How much of your retirement assets are in taxable accounts, and how much are in tax-deferred accounts? Your answer can help create a schedule of when to tap which accounts in order to make the most of your retirement income and avoid excess taxes or penalty charges.

[CLICK HERE to read the article, “Sequencing Asset Liquidation -- Which Retirement Assets Should You Use First?” from National Endowment for Financial Education, 2016.]

Have you paid off your mortgage? Among homeowners age 65 and up, at least seven out of 10 have fully paid off their mortgages. However, if your mortgage is enjoying a low interest rate, you may want to consider investing your extra cash into tax-deferred accounts or higher dividend paying stocks. Depending on your situation, multiple options may be available.

[CLICK HERE to read the article, “With rates so low, should you pay off your mortgage?” from MarketWatch.com, Dec. 16, 2015.]

[CLICK HERE to read the article, “Retirement Saving Versus Mortgage Paydowns,” from The National Bureau of Economic Research.]

If you have a retirement income gap, are you willing to downsize from your current home?

Home equity among homeowners age 65 and up averages more than $200,000. Consider the potential value of selling your current home and buying a much cheaper one, then repurposing the leftover equity for a retirement income stream and/or an emergency fund.

One interesting fact is that nearly 50 percent of people who move after retirement do not downsize. In fact, 30 percent move to a larger and/or more expensive home. Regardless of what you do, remember that even after you pay off your mortgage, you’ll still need to budget for property taxes, homeowner’s insurance, utilities, repairs, maintenance and other expenses.

[CLICK HERE to read the study, “Home in Retirement: More Freedom, New Choices,” from Merrill Lynch, 2015.]

[CLICK HERE to read the article, “Retirees, Should You Buy or Rent When Downsizing?” from Kiplinger, May 2015.]

Do you have an emergency fund? If not, look around. Perhaps you’re still hanging on to a boat you haven’t taken out in years or an old Harley Davidson gathering dust -- and potential equity -- out in the shed. You may have assets you can turn into cash quite easily, if needed.

Do you have a contingency plan in case your initial retirement plan doesn’t work out? There are several concerns to consider here. For example, what if you want to move back to your old community because that vacation paradise is too far from friends and family? What if you get bored and want to go back to work -- will you leave the door open for that option among your professional network? What if you run out of income while you’re still healthy and have years to live?

No Internet quiz can provide personalized answers for these unexpected events. Give us a call, and let’s get started.

We are an independent firm helping individuals create retirement strategies using a variety of insurance and investment products to custom suit their needs and objectives.

The information contained in this material is provided by third parties and has been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions.


We are not permitted to offer, and no statement contained herein shall constitute, tax or legal advice. Individuals are encouraged to consult with a qualified professional before making any decisions about their personal situation.


If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference. 

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