Items to Review During Retirement
- Analyze your current portfolio. How much risk are you currently taking? What is the amount of volatility you are willing to accept and does your portfolio reflect that? If you know that you cannot bear more than 10 percent fluctuation when the market is down, is your portfolio positioned accordingly? I often hear consumers say they have a “conservative” portfolio. Conservative can mean different things to different people. The definition of being conservative is relative to the situation. For example, does conservative mean no more than 5 percent or no more than 10 percent to the institution or the broker who is managing your money? Clear communication is important.
- What are the avenues from which you receive income? Is your income coming from social security, pensions, investments, etc.? What percentage is coming from what source and how will this income be affected if a spouse passes away? Will there be a reduction in pension benefits for the surviving spouse? We know the surviving spouse will lose one of their social security checks. Once the short-fall is calculated, it is important to have a plan in place to make up for that short-fall. So, it is important to know where your income is coming from when you are considering what to review throughout retirement.
- Taxes should be reviewed on a regular basis. There are many areas retirees over-look when it comes to taxes. Many are unnecessarily giving money away to the government. Unless you feel the government can do a better job spending your money than you can, it is important to get your taxes reviewed within your investment strategies. There are more to taxes than just your write-offs. For example, let’s say you have a mutual fund or a broker doing a lot of buying of selling of stocks within your portfolio. Within one year you could owe 20 to 30 percent more due to capital gains taxes. You should call your mutual fund’s company or your broker and ask them, “What is the turnover ratio of my portfolio?” For example, if the mutual fund you own has a turnover ratio of 50%, this means the mutual fund manager is buying and selling 50% of the portfolio each year and you are paying a good amount in short–term gains as opposed to long-term gains. You might want to consider your taxes when thinking about items to review during retirement.
- Trust and Will planning- If you don’t have a trust or will, it is likely that your hard earned assets will be stuck in probate. Needless fees will be absorbed by the state and attorneys instead of your family, charitable organizations, or others that you would have liked. This is why it is important to consider trust and wills when considering a review during retirement. Also, it is just as important if not more important, to make sure you have a Power of Attorney for asset management and health care. This will make life much easier for both you and your family while you are alive, if for some reason you are unable to make certain financial or health related decisions on your own. This is also very important to consider when considering items to review during retirement.
If you have questions regarding your retirement plan or need a retirement planner in Corona, please don’t hesitate to call our office at 877-213-7233, or visit our website at https://www.safeguardinvestment.com/contact-retirement-specialist.php to request more information or schedule a consultation.