Retirement planning allows you to better enjoy life upon retiring. Aside from helping you reach your future financial goals, it will also help you achieve a secure and comfortable retirement. Planning for retirement involves various financial strategies, which include your assets, savings, and investments.
Creating a retirement plan is not a simple task. So, whether you have already started planning or are only about to start, it’s best to learn about the things to consider. Here are some of them:
- Time Horizon
Your current and expected retirement age are important elements in creating an effective retirement plan. Taking these factors into consideration will help you determine which investments will help you achieve an ideal income when you retire.
For instance, if you still have at least 30 years before retiring, long-term investments like stocks are most beneficial. But if you are older, it’s best to choose less-volatile investments which will help preserve your capital and provide enough income for your retirement.
- Retirement Expenditures
While it may seem like you’d be spending less during retirement, this isn’t always the case. Since you’ll have more free time to travel, take up new hobbies or even pursue another academic degree once you retire, you might spend as much as before. For that reason, it’s best to consider these potential costs besides daily expenses like housing, food, and transportation.
You should also factor in future healthcare costs and expenses that might spring up in the family, like your grandkids’ tuition fees. Once you get a clear estimate of your retirement spending habits, you’ll have a better idea of how to invest and how much money you should have in your nest egg.
- Estate Planning
Managing your estate is another crucial part of retirement planning. Estate planning involves determining how assets are managed and distributed in the event of an individual's passing or incapacitation. Here, you can set up trusts or create a will and designate beneficiaries for your life insurance and investment accounts.
Besides ensuring financial security for the people you’ll be leaving behind, estate planning also reduces the burden of its complicated process on your family. Since it can be a taxing job to do on your own, hiring a financial advisor is most beneficial.
Talk to a Wealth Planning Expert
Although learning about the things to consider in planning your retirement is helpful, consulting a professional makes a big difference. If you need help with retirement planning, contact Lamkin Wealth Management in Louisville, KY today! Mark Lamkin has a team of retirement experts that can assist you with wealth management and other financial services.