Do I Have Enough Money to Retire?

By Krista McBeath, McBeath Financial

My family and I recently returned from our annual summer trek to Minnesota, where we take time off from our busy routines and welcome a slower-paced lifestyle and plenty of relaxation. Since we stay on lakefront property, we also take advantage of water-based activities, like swimming, fishing, and boating.

Boating on the lake has always been more than just a pastime for us; it’s a vital family bonding experience. However, it’s also been a growing source of differences of opinion between my husband and myself. Here’s the scoop:

We own a well-loved pontoon boat, which we’ve had for years. It’s perfect for leisurely gliding around the lake and sharing time with family while admiring the finest surroundings nature has to offer. But as our daughter is growing up, I’ll admit it would be nice to have a boat that can keep up with her sense of adventure.

Of course, my husband is eyeing new speed boats with all the works—mega horsepower, all the bells and whistles, christened with a snappy name painted on the hull. And this all sounds great—I’d love it, too—except those boats can cost $50K or more! I can’t quite get on board with that price.

So, we’re at a crossroads: Do we compromise now on a more affordable used boat that meets our needs but not our dreams, or do we stick with our trusty pontoon a while longer, saving up for that dream boat down the line?

Just like with our boat, the question of retirement boils down to timing and readiness. Do you take the plunge into retirement now, knowing it might mean tightening the belt on some of your desires due to financial constraints?

OR

Do you stick it out and work a few more years, adding to your portfolio and ideally having enough money available to maintain your current lifestyle in retirement?

Choose a Retirement Strategy

It’s very important to make sure to have enough money saved for retirement so you can continue living the lifestyle you’re used to—one where you have to make very few changes to your current spending habits.

Deciding when to retire with a financial safety net in place is a very individualized decision—and one I help my clients with often. I’ve created retirement income plans that range from modest accounts of a little less than $300,000 all the way up to multi-million dollar estates.

Ask Important Questions

Many factors determine how much is needed to retire, and the planning and management of your portfolio is often more important than the actual dollar amount of accumulated savings. In addition to income and expenses, you need to consider inflation, liabilities, and taxes. Here are some questions I ask my clients when we begin evaluating their retirement expectations:

1. Lifestyle Goals: What do you envision for your retirement? Much like we ponder what kind of boating experiences we want for our family? Determining the lifestyle you desire can help outline how much you’ll need to save.
2. Financial Readiness: Are you financially prepared for retirement, akin to assessing if we can afford a boat upgrade without jeopardizing our future? It’s crucial to evaluate your savings and investment status.
3. Inflation Impact: Just as boat maintenance and upgrade costs rise over time, have you considered how inflation will affect your retirement savings and expenses?
4. Market Volatility: Reflect on how market fluctuations could impact your retirement savings, similar to how we consider the resale value and longevity of our boat.
5. Healthcare Costs: Have you factored in healthcare and potential long-term care costs into your retirement plan, akin to unexpected repair expenses that might arise with a new boat?

Make Your Decision

Ultimately, whether we’re talking about boats or retirement, it’s about making choices that align with our values, goals, and financial realities. And just as we’ve chosen to wait on upgrading our boat, the decision on when to retire deserves equal patience and planning, ensuring that when the time comes, we’re as ready as we can be for the adventures that lie ahead.

So, as we navigate these decisions, the question remains: Do you have enough to retire? Or perhaps more fittingly, are you prepared to make the most of the journey, however you choose to embark on it?

If you’re pondering when to set sail into retirement, or how to steer your financial course to meet both your current desires and future needs, we’re here to help guide you. At McBeath Financial Group, our mission is to assist you in charting a course toward a retirement that’s as fulfilling and secure as you’ve dreamed. Connect with us to explore how we can help you navigate your retirement planning journey with confidence.

     Krista McBeath is an Investment Advisor, Chartered Financial Consultant, a Licensed Insurance Advisor, and a Fiduciary. As an experienced tax advisor, she specializes in financial planning, investments and insurance. You may contact Krista at 309-808-2224 or visit www.mcbeathfinancial.com for more information or to make an appointment. 

Advisory services are offered through Landmark Wealth Management Inc, dba McBeath Financial Group, an Illinois Registered Investment Advisor firm. Insurance products and services are offered through McBeath Tax and Financial Services, LLC. McBeath Financial Group and McBeath Tax and Financial Services, LLC. are affiliated.