Making your retirement last video
Welcome to the third video in our series
Making Your Retirement Last
In the second video, we talked about the journey to retirement (continued…)
- We discussed what it takes to get to retirement
- How to determine what you may need to support your lifestyle
- How much you may want to save up to support that lifestyle
- How to properly manage and incorporate risk during the ascent
- But getting to retirement is only the first step. Once you’re there, you’ll want a strategy for making sure your retirement savings last you the rest of your life and your spouse’s life as well.
- Which brings us to… (continued…)
Key #2 – Making Your Retirement Last
Before we talk about your retirement, here’s a quick analogue to illustrate the importance of preparing your retirement strategy for both parts of the journey
- Every year, the world’s most adventurous hikers set out to climb Mt. Everest – the highest peak on the planet
Through training, perseverance, and preparation -
- Many of these hikers are able to get to the top without incident
- But the smartest hikers also think carefully about the journey back down – making sure they pace themselves across the whole climb so both phases of their journey are equally successful
- Likewise, once you’ve achieved retirement, the journey has actually just begun.
Your strategy should be just as rigorous to help you get through your retirement as it does to get you there in the first place
To accomplish this goal, there is a common blindspot you should mitigate against.
Moving beyond Average to create a more complete strategy
- Most retirement strategies are built around average
- Average expectation of life expectancy
- Average expectation around gains
- Average expectation around planned and unplanned expenses
- Average is certainly the right place to start -
- But you’ll also want to be ready for circumstances when average doesn’t happen.
- If you encounter a correction or unexpected expense during your retirement;
- Your strategy – and your retirement should account for these possibilities so it stays on track
Be prepared for Non-average scenarios
- Imagine, hypothetically, if your well-constructed retirement strategy is expected to perform well on average – or under 70% or even 80% of scenarios
- But it has some issues under 20% of scenarios
- That means – chances are – you’ll be okay. But 20% is certainly a high enough probability that you should plan for it
- Your chance of getting in a car accident each year is extremely low - way under 20%, but you always make sure to protect against that unlikely scenario
- Likewise – you’ll want to make sure your strategy is tested to handle any scenarios, not just the average or common ones
A more complete strategy
- In addition to providing your expected lifestyle for the expected period of time – and protecting you against non-average risks - your retirement strategy needs to be ready for the unexpected:
- Unexpected market shifts
- Unexpected healthcare or other expenses
- Unexpected lifestyle requirement shifts
And of course, you aren’t just creating this comprehensive strategy for you.
You’ll want (continued…)
An approach that works for both spouses
- Your strategy will need to last through the rest of your lifetime – and your spouse’s lifetime as well
- It should be built to support your lifestyle
- It should be prepared for contingencies and expenses for you and your spouse
- It should be ready to go the distance
- And provide for any legacy goals you both have as well
Let’s quickly summarize:
- A properly crafted retirement strategy not only helps you manage the ascent to retirement; it is robust enough to handle all of the contingencies to get you all the way through retirement
- Most retirements are built on “average” expectations; a more robust strategy buffers against non-average possibilities
- Contingencies to plan for include market shifts, health and long-term care expenses
- And of course, your strategy should support you, your spouse and any other legacy / family needs you might have along the way
When it comes to planning your retirement, the new landscape certainly introduces new challenges – but it also comes along with new opportunities to thrive over the long term.
- Even with all of the changes that happened during the pandemic – the same fundamentals that drive successful planning for retirement still apply – now more than ever
- Navigating retirement is a complex endeavor – (continued)
- but with the right focus on fundamentals, you can feel confident about your strategy
For a tailored approach, click the button below to connect with an experienced Edward Jones Financial Advisor who will partner with you to create a long-term personalized strategy to help you achieve your retirement goals.
Thanks for watching – and we’ll see you in the next video