By Dennis Kagel, ChFC
There is no guarantee that if we eat right, exercise, adopt a healthy lifestyle, and get regular physical check-ups that we’re going to live a long and healthy life. However, when it comes to a long and healthy life, I sure want to put the odds in my favor — and I’m sure that you do, too.
When it comes to planning financially for retirement, there are ways to “put the odds” in our favor. In my years in the business, I’ve concluded that there are three main mistakes that people make with their money, especially people who are in their early to mid-50’s, and on into retirement.
Mistake #1 — Most people think in terms of a total balance when it comes to evaluating their retirement plans. That’s understandable, because as we advance through our working career, we typically contribute to retirement plans, and we (hopefully) see our balances grow. It’s easy to get caught up in looking at our statements and think, “I’m only 30 years old, and I’ve got $100,000 in my plan… or I’m now 40 and I’ve got $250,000… or now I’m 50 and I’ve got $400,000, etc.” The perspective that’s required as we near retirement is to think in terms of INCOME rather than a total balance. In other words, how much monthly income will your retirement accounts generate for you during retirement? Identify your goals financially, and then figure your anticipated income and expenses during retirement. Longevity risk must be taken off the table!
Mistake #2 — Failure to identify and combat the six major retirement roadblocks: taxes, risk, health care costs, excessive fees and commissions, inflation, and insufficient income planning. Any of these individually, or any combination, can have a dramatic negative effect on the quality of your retirement. In our initial planning with our clients, we help identify if these roadblocks exist for them, and the best ways to prevent them from wreaking havoc on someone’s retirement.
Mistake #3 — Failure to use the tax laws to one’s advantage. A famous judge is quoted as saying, “There are two sets of tax laws. One for the informed, and one for the uninformed.” I find most CPA’s and tax-preparers are very good at completing tax forms and generating financial statements, etc., but it’s a rare breed of tax professional who really digs into the tax code to identify options that can help their clients save significant amounts of future income taxes. I am not a CPA nor tax lawyer, but I’ve learned from some of the very best tax people in the country that there are fully legal strategies available that can help just about anyone save significant amounts of future taxes.
We invite you to give us a call today at 309-454-9171 to arrange a no-obligation and no-cost visit where we can help you evaluate whether or not you are making any of the three financial mistakes; and if so, we can show you ways to protect yourself and your retirement nest egg. Wouldn’t it be worth taking 30 minutes to evaluate your situation and to learn about possible strategies that could greatly “put the odds” in your favor for a successful and comfortable retirement?
All information presented is believed to be accurate and correct. All attempts have been made to present accurate information. Please consult your tax and investment professional for any specifics. Dennis Kagel Financial Services is an Independent Financial Service and insurance products are offered through Dennis Kagel Financial Services.
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