Rethinking Retirement
Retirement planning is an integral part of estate management that ensures you have the financial resources needed to enjoy a comfortable retirement while also securing your estate for future generations.
Golden Years – start of an exciting phase
Retirement is the next great phase of life – the start of a new adventure full of promise. Most people spend their entire adult lives diligently working and saving for this moment. But, with changing times one thing is very apparent: Retirement has changed – and so has the role of preparing for it
is the estimated cost to cover healthcare expenses for a healthy 65-year-old couple retiring in 2022
Growing Retirement Needs
The current average Life expectancy of a man in the United States is 73.2 years and that of a woman is 79.1 years.
Historically, retirement funding was structured around three main pillars: Social Security, personal savings, and pensions. Social Security provided a safety net for retirees, while pensions offered guaranteed income based on years of service and salary history. Personal savings served as a supplementary source of income, allowing individuals to maintain their desired lifestyle in retirement.
Current Trends
Today, the reliance on personal savings has surged, with many individuals finding that traditional pension plans are becoming less common. As companies shift away from defined benefit plans to defined contribution plans, such as 401(k)s, employees are increasingly responsible for their retirement savings. This shift has resulted in a greater emphasis on personal savings, which now dominate retirement portfolios.
Factors Contributing to the Shift
- Decline of Pension Plans: Many employers have phased out traditional pension plans, leaving employees to rely on their savings and investment strategies.
- Increased Life Expectancy: With people living longer, the need for a larger retirement fund has become more critical, prompting individuals to save more.
3. Economic Uncertainty: Economic fluctuations and market volatility have led to a more cautious approach to retirement planning, with individuals prioritizing personal savings to ensure financial stability.
4. Social Security Limitations: As Social Security benefits face potential cuts and adjustments, individuals are recognizing the need to supplement these benefits with their savings
The escalating cost of living, combined with rising healthcare expenses and inflation, is diminishing the purchasing power of the dollar. As a result, our retirement savings may erode faster than we expect
Are we prepared to address this erosion of purchasing power in retirement?
To mitigate risk, we need a diversified portfolio that can withstand market volatility and provide a sustainable, growing income, as detailed below
Building a Resilient Portfolio
that it’s critical to have another source of guaranteed income beyond social Security benefits
Diversification is a fundamental strategy in investment management aimed at reducing risk and enhancing returns – A Key principle for Retirement planning
A general guideline is to spread investments into multiple buckets that offer growth, guaranteed lifetime income with tax advantaged strategies.
High Risk- HighReward
Predictable Pension like Income
Reduced Tax Liability
Guaranteed Income
Financial Security
Peace of Mind
Add Certainity to your Retirement Portfolio
Guaranteed income is crucial for ensuring financial stability during retirement. It provides a reliable stream of cash flow that can cover essential living expenses, reducing the risk of outliving one’s savings
In today’s combination of confusing signals from the economy, the potential for additional market downturns and rising retirement costs is a reality. It’s important to look for solutions designed to help grow and protect your retirement savings, while also providing a source of guaranteed income you can’t outlive. Fortunately, there is a potential solution.
Our expert team at Varana Financial Services LLC provides personalized retirement planning services that align with your long-term estate goals. We assist you in understanding the relationship between retirement accounts, tax implications, and estate planning strategies.
Schedule an appointment with us for a personalized planning session: Book Your Appointment
Explore our resources to discover how effective retirement planning can enhance your estate plan. Learn about the tools available for maximizing retirement savings and protecting your estate from potential financial risks.