|The Power of Planning...
The longevity issue is one area of retirement planning that only in
the last decade has become a key consideration when planning a
retirement. Here is why;
• Social Security – The decision when to apply for Social
Security benefits, from age 62 to 70, requires extensive analysis, as
it is essentially longevity insurance. A poor decision could result in
losing hundreds of thousands of dollars of income should your
lifespan near 100 years old. If you are married, or have been
married, a coordinated social security claiming strategy needs to be
mapped out, in order to maximize available benefits.
• Required Minimum Distributions - At 70 ½ years old,
distributions from most deferred retirement plans need to begin.
Should you still be working or have sufficient income, the possibility
of being pushed in a higher tax bracket by these distributions are
real. Addressing that possibility is best done years in advance in
order to minimize taxation, so to keep those tax dollars that may be
needed far into the future.
• Investment Compounding – Underestimating the financial
force of exponential growth of assets, attributed to compounding
over a number of years, is mathematical folly. Compounding is key
to a successful retirement.
• Trends in Budgeting - Economic trends in personal income
and expenses, as well as drilling down as to an individual's specific
situation, including likely future health conditions, make the longer
term projections as worthwhile as possible.
The need for a concrete retirement plan, built incorporating
longevity issues, is the best path for long term financial security.
Working with a Certified Financial Planner, the highest standard for
planning services, gives you access to the best quality in building
your plan and achieving your goals.
Let's Make a Plan!
|Thomas C. Vaccaro, CFP®
Certified Financial Planner since 1988