Retirement may be a single word, but it maybe a complex issue for many seniors. With proper planning you can enter retirement more prepared for the rest of your life, as long as you recognize the path there is not always an easy one. Too many people view retiring as a single action you take at the end of your working life, and neglect to understand the planning process you need to perform in advance to make it successful.
The planning process for each person may vary greatly, but the major steps along the way should always remain the same. This is the one step you do not want to rush if you desire a secure financial future.
List Your Financial Goals For Retirement
This step may seem fairly obvious as most people have an idea in their mind of what they would like to have when they retire. However, this refers to a much more broad selection of goals to allow yourself to visibly map out how to achieve them. After all, writing down you would like to purchase a luxury fishing vessel is less conducive to the overall planning process. For the majority of future retirees, and those who are not sure what they should be listing, a standard set of goals is as follows: Normal living expenses, incidental expenses, discretionary funds and any inheritable legacy you would opt to leave behind. Naturally, leaving this list as it is would be the equivalent of having hopes and dreams without considering the realities of the situation. Thus your goals must be balanced out by acknowledgment and planning for your risks.
Recognizing Your Risks
As far as preparing to retire goes, recognizing your risks is more than just accepting that they can occur. At the very least you should have a general plan to address each type of risk in place. Remember as with goals, the more general the category, the more flexible your solution may be when something you did not consider arises. Your risks may typically fall under these categories:
Health is consistently one of the more commonly seen risks as health tends to decline with age and it is easy for the unexpected to occur. Financial investments bring with them a variety of risks such as fluctuations in the market, inflation, interest rates and the like. Unexpectedly large expenses may sound like a catch-all, but it is the most necessary of all to prepare for. From natural disasters requiring relocation to loss of income from the death of a spouse, there are a variety of issues that can turn your dream retirement into a stressful financial situation in a mere moment. Lastly, as our healthcare system continues to advance, or even just by good fortune, you may be blessed with longevity you did not prepare for. If you happen to outlive your 20 year period you budgeted for and have no backup plan things may go awry.
Planning for retirement doesn't have to be stressful or overly complicated. At BD Financial Concepts, we can help you work towards securing your financial future for retirement, and help you ensure you leave a legacy that your loved ones deserve. Even if you have already retired, it is never too late to review and adjust your portfolio in our ever-changing climate. Contact the BD Financial Concepts team to learn how we can help.
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