It’s always great when you have a plan in motion. When individuals and families save for the future, no textbook method works for everyone. Be that as it may, it can be hard to find out how much you need to save when planning for your future. It can seem rather difficult trying to paint a pretty picture that both looks great and sounds realistic to you, especially when it’s many years down the road. But, it is crucial and needs to be done so that you can retire at the appropriate time and live the rest of your life in comfort.
With a professional financial advisor, you can get help and be guided on the right track to your ideal life beyond your career. Winging it and just working until you think you have saved enough money are not viable options to pursue, so you should consider seeking assistance to help shape a crystal-clear vision for your future.
Once you have a definite vision for your future, it is imperative to try to stick to it until it’s officially time to call it a career. Moreover, as things can change, such as getting laid off or becoming unhappy with your job, we can also suggest some backup plans in case something unexpected happens with your life. We can definitely find alternative paths to retirement if something doesn’t work out for you, so there would be no reason to panic and to consider your retirement in jeopardy.
Without further ado, here are six things to take into account when talking with your advisor about retirement:
1. Where you want to be
Some people have a concrete idea of where they want to live for the remainder of their life; somewhere exciting, fun, relaxing, or simply away from the mundane. Many people retire near the ocean, in a refreshing mountain range, in a gentle series of plains, or a specific location that they’ve been eyeing for decades.
To others, where they go might not be much of a priority. Regardless, where you want to retire is essential, as there are more expensive places than others. For example, coastal areas tend to cost more than inland areas. While picking a place where you want to move to after your career, you need to figure out how much it costs to live there so that you can plan accordingly and live comfortably. Sound overwhelming to decide? Consider referencing this resource from U.S. News on picking your ideal retirement spot. No matter how to determine the right place for you, your destination is a vital factor in how much longer you are going to work for.
2. What you want to be doing
Another thing that is a critical factor in how long you will be working is your career. In essence, what is the path that requires the shortest amount of time and effort to get to your destination, that being your retirement in your ideal location?
Sometimes, people have steady, cushy jobs that they simply need to keep for several years to make enough money to retire. Other times, significant changes need to be made, such as trying to find a better job, getting an education for a better job (such as obtaining a master’s degree), or even just changing career paths altogether. You might even have to relocate, either to get a job that pays better or to save on living expenses that you can redirect towards your retirement plan.
3. How you want to be spending your time
Revisiting point #1, you likely do not want to retire somewhere and do nothing else for the remainder of your life. There are probably many activities that you are looking forward to doing when you no longer have to work. Perhaps you want to travel the globe, buy a horse, do things like fishing and climbing, or maybe you want to attend some prolific sporting events like the summer games or football championships.
Truth be told, all of these things are significant expenses in their own right, and they too factor into how long you are planning on working, just like choosing a relaxing place to live. At the same time, these things might mean a lot to you, as you likely have never had the chance to enjoy these activities for decades, if ever. Being able to do the things that you’ve always wanted should be just as important as establishing where you want to retire.
4. How long you plan to work
You likely want to be at a certain age at retirement, and you probably have an age that you are projected to be when you retire should you choose to continue your current path or go in a brand-new one. However, it is also essential to be able to earn a bigger salary than what you currently might be making or do something that means much to you on a personal level.
If you are still rather young, then you might be able to consider switching over to a career that involves work that you would rather be doing while looking forward to your retirement. For these people, they might not see age as a priority, so long as they enjoy the work they do. Such career changes can happen at some point in the working stage of life, which might involve jobs like content writing, in which the individual can be able to learn more about the world via research, in which he or she might have been more eager to otherwise learn about upon retiring.
5. Embracing negotiations between your current and future self
With all of your future aspirations and endeavors, your path to retirement is not guaranteed to be a short and affordable one, which is why a financial advisor is strongly recommended to help you set up a plan. Your advisor would assume the role of yourself when you retire.
If you have some particular scenarios in mind for when you retire, your advisor can show you what kind of retirement plan you should strive for to get there. If you want to retire early, your advisor might suggest more affordable places to live.
If you want to be able to retire to the beach and do plenty of fun things, your advisor will suggest a long-term plan that may involve a change in your career. Your advisor even might consider having you switch to part-time work in your later years so that you can still earn some money while still enjoying the things you want to do without making major life changes or commitments.
Whether you are an astrophysicist living in the mountains or a librarian in a resort town, we can suggest things you can change about your career that won’t seem like you are making sacrifices. It is crucial that you have a balance between your current self and your ideal retired self.
6. Identifying misalignments
We understand that not everyone’s path to retirement will be picture-perfect. It is not realistic to expect lavish living, early retirement, and lots of money left in your bank account. While it’s not impossible to achieve all three of these retirement goals, we can certainly help you achieve two out of these three.
We call this our “retirement trifecta,” and it can be summarized with a simple Venn diagram.
● People who retire early and want plenty of money saved will tend to end up living somewhere cheap.
● People who want plenty of money saved and want to live somewhere lavish will tend to retire late.
● People who want to live somewhere lavish and want to retire early will tend to have little to no money saved.
While this isn’t definite for every individual, it is an excellent way to indicate what needs to be done to achieve your ideal retirement if you don’t yet have a plan officially in motion. An advisor can help you to identify what kind of levers to pull or change to get as close to what you would consider being ideal. In essence, how to course-correct.
Most people do not really care about how much money they make overall, so long as they can live comfortably month-by-month and contribute every now and then towards making their retirement happen when they are ready to do so.
Thus, looking at your options for retirement can ensure that you are on the right path to not just any retirement, but your ideal retirement. Whether you want to keep a pile of money, retire at a certain age, be able to enjoy life beyond retirement or a combination of the three, you have a plethora of resources and guidance available to you thanks to our professional financial advisors. Figuring out your finances in incremental detail is really about prioritizing and identifying what is important to you.