RETIREMENT PLANNING: The Heart of the Matter

As seen in “Lifestyles – Boomers and Beyond 2015”, a special section of The Issaquah Press, Sammamish Review and SnoValley Star.

Yes, retirement planning can seem like a daunting task, and yes many, if not most people feel that they have started too late or come up short in some respect. Regardless of whether you are ahead or behind schedule, it is healthy to review the essentials and make sure that you have done what you can. Of course, the critical questions are things like: Will I run out of money? How much more do I need to set aside? How much can I spend with confidence, both before and after my income changes? How does Social Security fit in, and what is the best strategy for taking it? Where should my money be now? Are there any ways for me to increase my level of certainty?

Here is a short list of action-related items that may help you:

  • Consider hiring a fee-based advisor who has “fiduciary” obligations to you. This is a time of life where the stakes are too high to go it alone. There are strategies for leveraging and raising certainty that are largely unknown in the financial “world of selling”.
  • Start with a budget. You have probably long since graduated from the need for a budget. However, this is again critical as you clarify your essential lifestyle income needs from which your future needs can be calculated with inflation adjustments
  • Identify how much “for sure” lifetime income you will have. This includes pensions, social security, and certain types of guaranteed lifetime income tools. Research supports the notion that a good level of guaranteed income contributes to retirement happiness and longevity.
  • Discuss and examine the concept of “age-appropriate” investing and make some well-considered shifts in proportions related to risk levels.
  • Delve into the “discomfort zones” of retirement risk management issues. This will include issues like:

o      The probability of needing care

o      The alternate approaches to covering possible care needs and the costs of each

o      Tax risk and strategies for reducing the impact of future taxes.

o      Market volatility and related investment risks: The effects of a possible negative “sequence of returns” in early years on the overall soundness of your plan.

  • Be sure to integrate your plan with a holistic view of wealth, which includes the wealth in wellness, meaningful relationships, purposeful living, and giving. You will appreciate an advisor who can listen carefully, and incorporate who you are into the essence of your financial retirement plan
  • Finally, be sure to determine whether you need a will or a trust, and prioritize getting a referral to a lawyer who has a reputation for expertise and service at a reasonable cost.

Douglas Anderson is the owner and manager of Life Directions Financial, a business in Issaquah that helps a select clientele to increase their fulfillment and peace of mind in retirement through effective planning. Reach him at 425.677.8995 or or through the website: