4 Steps to Successful Retirement Planning

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Published October 26, 2012

Planning is bringing the future into the present so that you can do something about it now. - Alan Lakein, writer

Retirement planning has become a major source of anxiety for people today. It seems like a huge challenge for young individuals because there are so many variables. Will Social Security be around for me when I retire? How can I possibly know how much to put away for retirement when it seems so far down the road? Planning is equally challenging for individuals nearing retirement. In order to make this process a little simpler, here is a 4-step retirement planning strategy.

1. Create clear goals.

Goal setting is the most important part of the retirement planning process. How can we possibly know how much money to save if we do not know what we will need to retire? Think about how you want to retire. How much of your pre-retirement income will you need when you are retired? What kind of lifestyle do you want to live during retirement? Where do you want to retire? These are all questions that you will need to answer in order to come up with a good plan.

2. Start saving early and put away as much as you can afford.

Now that we have goals established, we need to make sure you are putting enough away to meet those goals. In the early years, it’s smart to put away as much money as you can afford. You will be glad you did in the later years. Remember, the earlier you start the less you will need to put away every month.

3. Work with an independent financial professional

Independent advisors help you identify your goals and how much money you need to put away to meet them. An advisor customizes a plan using a wide range of investment vehicles like real estate, stocks, bonds, annuities, life insurance, etc. Look for an advisor that does not represent any one specific investment company. When you hire an advisor you need to make sure he is working for you and has access to a wide variety of investment vehicles from a variety of different companies. This will help you get the best deal. Also, make sure they have an interest in growing your account, and they haven’t made all of their money up front. If an advisor makes all of their money up front what incentive do they have to watch your account?

4. Review your accounts and re-evaluate your goals

Meet with your advisor at least once a year to determine whether or not you are still on path to meet your goals. This is especially important as you approach retirement. You and your advisor can adjust the risk level in your portfolio to accommodate your needs. If your accounts have done better than projected, you will be able to lower the risk level needed in your portfolio to meet your retirement goals. If your accounts have not done as well as projected, this will give you an opportunity to make any necessary changes in your portfolio that will help you get back on track.

These 4 simple steps will help you get on track to retirement. Take some time to figure out how you want to retire, and make sure you work with someone that will help you meet those goals.

Princeton Equity Partners is an Independent Wealth Management Firm. We help our clients plan for and achieve retirement. We use a wide variety of investment vehicles to help our clients meet their goals such as non-traded REITS, annuities, stocks, bonds, etc. Contact Jeff Gove at 888-260-0926 or email him at jlgove@princetonequitypartners.com

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