5 Ways to Help Pre-Retirees Balance Goals

5 Ways to Help Pre-Retirees Balance Long- and Short-Term Goals
The economy may be on the mend, but Americans are still feeling anxious about retirement. According to the 2014 Retirement Confidence Survey, only 18 percent of U.S. workers reported feeling “very confident” about having enough money to fund a comfortable retirement.
The key lies in balancing your long- and short-term goals. These five tips can help.
1. Time is of the essence. When it comes to retirement, the longer your time frame, the better — so start planning early! At least five years before retirement or semi-retirement is a great time to begin the formal retirement planning process. (Of course, you’ve already been saving for years at this point!) Work with a financial advisor who employs strategies that align with your best interests.
2. Make a budget and stick to it. Create a realistic budget based on your guaranteed income and your regular expenses, along with a cushion for “worst-case scenario” items such as health care and emergency funds. Your budget should help balance the payment of short-term monthly bills with 401(k) and IRA savings for the long-term.
3. Understand your life priorities. Consider the trade off (a.k.a. the opportunity cost) between working versus retirement. Need help creating this vision? Our Wealth Vision financial planning software will help you plan for all the “what if” scenarios you can dream up.
4. Understand how financial planning connects retirement components. The face of retirement has changed, and your financial planner can help you navigate these new realities. In the past, folks retired and died soon after; today, it’s essential to plan for longer life expectancies that require a range of investment options. These options may include simply working longer, especially for those that are healthy and enjoy their jobs, as well as a diversity of investment buckets to ensure a comfortable retirement.
5. Get a handle on your taxes and health care expenses ahead of time. Converting qualified money to Roth IRAs over time can help you save taxes over a lifetime; investigate this tax-mitigating strategy before it’s time to retire. Take charge of your health care expenses by looking into Medicare at least six months before you turn 65.
Above all, enjoy the journey — but take care to remain balanced in your financial life.
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Post Excerpt
Wondering how to balance your short- and long-term retirement goals? These 5 tips can help!Sources: http://www.ebri.org/pdf/briefspdf/EBRI_IB_397_Mar14.RCS.pdf
Listen to our podcast on the topic with Win Damon on WNBP.com and 106.1 FM radio WNBP in Newburyport.


Stuart Steinberg, CPA, MBA has been dealing with families and their money issues since 1988. He can be reached at 55 Pleasant Street Newburyport and at (978)864-9581 and stu@eaglerockfinancial.net
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing.
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