While the road to retirement and saving for this milestone will change and evolve over time, the destination is the same – living comfortably and with financial security once you leave the workforce. In order to retire with confidence and financial freedom, it is important to take the appropriate steps to set yourself up for success.
Retirement planning includes the processes and habits you put in place to maintain your lifestyle once you are no longer working. Retirement planning is a multistep process that requires the thoughtful consideration of your current living expenses and assets, future retirement goals, and realistic saving and investing habits.
The process of retirement planning can be condensed into 4 steps:
- Knowing where to start
- Calculating how much money you will need
- Dealing with debt
- Developing an investment strategy
This month’s blog from The RaeLipskie Partnership will walk you through four planning tips and strategies for a frictionless retirement.
Step 1: Knowing where to start
The groundwork of retirement planning begins with consideration of your current age and your ideal retirement age. Once you have an idea of when you want to retire, you will be able to better understand the steps you need to take in order to meet this target. While retirement is a lifestyle milestone, it is also a financial milestone achieved through successful spending, saving and investing habits put in place earlier in life.
While retirement may seem far away now, it is important to develop a plan for retirement early to ensure you are saving and investing for your future. Once you have determined your retirement timeline The RaeLipskie Partnership can help you develop a financial plan to help you retire with ease.
Step 2: Calculating how much money you will need
Developing realistic spending expectations into your retirement will help you to ensure you are exiting the workforce with a reasonable and liveable amount of money, to financially support yourself and maintain your spending and lifestyle habits.
To start, consider your current and future living expenses while you are working. Think of your current expenses as a baseline for what you will need in retirement. It is realistic to assume your living expenses in retirement will continue to stay the same once you are no longer working. However, big budget items may fluctuate depending on your new lifestyle. For example, you may incur increased expenses without a benefit plan provided by your employer, but you no longer carry commuting expenses. Next, consider any big budget items that you may be paying for, including travel, housing, increased medical expenses, transportation and care. While these may not be items that you have to factor into your current budget, or sit lower on your monthly expenses, as you age these items may cost more.
In order to plan for retirement, you must consider all living and lifestyle expenses and factor these items into your saving and investing plan. In order to thrive in retirement, and live with financial security later in life, it is important to adequately plan and save for any needs in retirement.
Speak to a RaeLipskie advisor to ensure your financial plan affords you the opportunity to retire frictionless and to maintain financial longevity well into retirement.
Step 3: Deal with debt
An integral part of your retirement plan should be cutting down or eliminating debts while you are still working. Utilize your steady and regular income to pay off accumulated debt including credit card debt, mortgage payments, car payments and student loans. By paying off your debts early, you are freeing up funds to put towards saving and investing for your retirement. Once retired, you will want to allocate your fixed income to living expenses and won’t want to worry about paying back debts owed.
When planning for retirement, first set your priorities on paying your debts down, then turn to saving and investing for the future. A RaeLipskie financial advisor can help you to understand your debts owed, and your investment goals to develop a financial plan that will put you in the best position for investing in a seamless retirement. Contact us to book an appointment with one of our finance professionals!
Step 4: Developing an investment strategy
Throughout your life and into retirement, regularly evaluating your investment strategy is key. Approach your portfolio manager to see if you are utilizing the best options available to you to develop a reliable retirement savings plan. The RaeLipskie team can help you to invest with retirement in mind. By developing a balanced and diversified portfolio, with reduced risk investments, the RaeLipskie Partnership prioritizes long term investment strategies that gear clients toward the successful accumulation of capital.
As private wealth managers, The RaeLipskie team creates and manages tailor-made portfolios of stocks, bonds and alternative investments with an emphasis on achieving your overall investment objectives. When developing your investment strategy, we will utilize a client-first approach, keeping your retirement goals and financial objectives top of mind.
Retirement is an important investment and is one of the key objectives when developing your financial strategy. In order to retire with ease and financial confidence, it is important to consider your retirement timeline early, and plan accordingly.
The RaeLipskie Partnership understands the importance of investing and managing your finances with long term goals like retirement always in mind. If you are interested in speaking with a financial professional from The RaeLipskie Partnership about developing a financial plan to ensure a frictionless retirement, contact us today!