appropriate, distributes your assets as you want them handled and minimizes your taxes, there is not a lot you can do.
Part II is a rolling deadline and impacts every one still working and maybe a large number of retirees. The deadline this time is "Retirement" or for those already retired, "Retirement Security."
If you do not believe you are close enough to worry about this yet, the next time you go shopping, take a look around.
Count how many sales clerks or cashiers you may see that you believe
to be past the age of 60. I mention retailing only because this is a
field that many older workers can transition into from prior careers.
It is not an easy job, and for the retirees to take this job only to
stand much of the time they are working suggests the income is more
important than any discomfort felt from the hours on their feet. Unless
you want to be in a similar position of needing additional income
during your retirement, you should confirm the amount you are saving is
sufficient and its growth rate is working as hard as you
are in your efforts to save.
Retirement Planning may sound like an easy process, but to truly determine the proper steps and to minimize risks along the way can be overwhelming. If you have started the retirement planning process only to shift to any other task to do, then you need professional assistance. You should not let years pass before you get the help you may need.
I am still amazed how many individuals still believe qualified financial planners such as a CFP will only work with someone with a great deal of money. While I know there are planners who have very high minimums, five hundred thousand or higher, I also know there are others such as my firm that will work with those just starting out as well. Many planners provide several services and may be able to assist you with your investments, your life insurance, perhaps other insurance, and maybe taxes. This means your account is not small at all.
Some of you may believe I suggest the use of professional planners because that is my profession. However, that is not the case. As a professional, the depth of my knowledge on this subject should be greater than that of the general public.
When any professional takes on a new client many times we are amazed
at the shape of the new clients planning, or, in
many cases, lack thereof. When the general public chooses to work with free services or computer software to do their planning, the result often is impersonal and sometimes just wrong. Working with a professional who depends on his or her reputation is often more likely to achieve the desired results than the free service or software tool.
Financial planners actually provide other services that are needed throughout your savings and retirement years. The first needed service is education. As the investor, many times you may not be aware of new investment tools or vehicles that may suit your needs very well. The planners task is to provide education in addition to their management services.
Through this education you may find a product that better suits your investment style or risk, and yet assists you in reaching your investment goals.
The professional planner will also be able to answer the nagging
question "will you have enough to retire and meet your future
expenses?" A qualified planner will have performed this calculation
many times and should understand the impact withdrawals will have on
your investments. Should your planner say "?as long as you average 8 to
9 percent annually, and you withdraw less than that each year?", when
answering the "will I have enough" question, they may not fully
understand the impact of withdrawals on retirement assets. You can average a nine percent return and withdraw only six
percent each year and yet, run out of money before your retirement is over. This may sound impossible, but I assure you it is not, and this is one gamble you do not want to take.
The professional is also the encourager. The investment markets will have their down days and periods. It is their job to manage your assets through this period. Without professional assistance, it has been discovered many individuals sell during down periods, thus wiping out prior gains or incurring losses and fail to reinvest until the markets have already made significant moves up, thus missing much of the recovery.
This is an area you should not go alone. Find a qualified planner in your area and maximum the relationship over the years. You will see many benefits.
HOW TO REACH THE WRITER
Would you like a response to a financial question? Send your question to Doug Horn, 115 W. Broadway, Maryville TN 37801. Be sure to mark your envelope Money Matters.
Doug Horn, CFP, is an area financial planner with more than 24 years financial experience and founder of Quality Financial Concepts, located in downtown Maryville on Broadway.
Doug Horn, CFP, Registered Investment Advisor in Tennessee and Texas and Registered Principal, Branch Office of and Securities offered through CUE Financial, Member NASD, SIPC.