Do you consistently review your Retirement Plan, Goals, and Asset Allocation through the year?
In today’s blog, we’re going to outline 10 Elements that may be crucial to the Retirement Planning Process.
Developing Your Plan
If you’ve ever gone through the process of having a financial plan developed for you or have even created one yourself, you may be aware of some of the factors that go into the preliminary structure.
Identifying and understanding your goals and how they will affect you, your family, your career, and your plans to and through retirement are a great way to start.
A question we might ask during our initial fact finding meeting is something to the extent of, “If you had 6 to 12 months to live and you’d be completely healthy and able to do whatever you wanted, what would you do that you have not already done”.
A follow up to that might be something like, “What type of legacy do you want to leave behind?”.
Do you have children that you’d like to leave money to, or maybe other relatives? Exploring philanthropic causes might be a topic of interest.
In some cases, families we work with might state that they solely want to focus on their life and maximizing it while they are able to.
From there, understanding what your expenses are, what your income might look like and where that income will come from, and even what your appetite for risk is, are all variables to consider.
After your plan is developed and finalized, you will more than likely move towards implementation.
Each of those steps can build on each other and can help gain momentum into taking a real interest into your overall plan.
Now comes for the part where our team remains hyper vigilant as we see so many fall off track, and that is the Retirement Planning Review.
Over the course of the year, typically depending on one’s preferred frequency of communication, we reach out to review the Retirement Plans we’ve implemented.
There are many ways to go about these reviews throughout the year, but for the purposes of this blog, we’re going to list out 10 Elements that we feel are very important to include if applicable.
10 Elements of a Financial Plan
1) Did we hit all of the goals we set out to complete in the year prior? Did we make the changes we said we would as client and advisor and did they meet or exceed our expectations?
This tends to include things like period savings goals, portfolio allocation, and investment performance.
2) Align your team. Schedule a conversation early on between your Financial Advisor and your accountant, to plan for the year ahead, assuming you’ve already conducted planning for the prior year, during that year.
3) Consider making any allowable retirement plan contributions that may count towards the year prior.
As we move through the year, making sure everyone is in-tune during tax season in order to get our clients’ accountants any documents they need is a priority.
After April passes, we enter the 2nd phase of our planning reviews which usually goes something like this:
4) Benchmarking cash flow and budgeting against our projections, the discussions we’ve had, and the patterns we’ve seen with each particular family over time.
5) Insurance reviews to make sure all aspects of risk management in your life are up-to-date.
6) Reviewing the strategy and contribution cadence with regards to accounts for your heirs which may include your children or grandchildren.
As a general idea, these discussions might take place between the months of May and August.
Once School is back in session, we know we’re working towards the home stretch, which is when the following might come up:
7) Required Minimum Distributions, if applicable.
8) Estate Planning Reviews. This could include coordination between your Financial Advisor and Estate Planning attorney.
Although just a portion of the overall conversation, we always stress the importance of making sure your beneficiaries are up-to-date.
9) Tax-Loss harvesting. Circling back to have a conversation between your Financial Advisor and accountant to review your gains and losses on the year and if they could present opportunity.
10) Review your Retirement Plan contributions to ensure you remained on track throughout the year, prior to any deadlines.
The Final Word
As we stated in the beginning, each of these concepts can be continuously reviewed throughout the year and this is more of a broad overview to help develop a template that works for you.
If you had questions on the above or would like to schedule a financial planning review with us, please do not hesitate to reach out!
Thanks for reading!
Disclaimer:
Rockline Wealth Management (RWM) is a registered investment adviser located in Islip Terrace, NY. RWM is registered with the U.S. Securities and Exchange Commission. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission.
Rockline Wealth Management does not offer tax or legal services. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation.
All investment strategies have the potential for profit or loss. Different types of investments involve varying degrees of risk, and there can be no assurance that any specific investment or strategy will be suitable or profitable for a client's investment portfolio. Asset allocation and diversification do not ensure or guarantee better performance and cannot eliminate the risk of investment losses.
The opinions expressed and material provided are for general information, and should not be considered a solicitation of financial advice or for the purchase or sale of any security.
Real-life and fictional examples given in this video should not be viewed as guaranteed outcomes when investing. Past performance is not indicative of future results and every individual’s investment circumstances are different. Individuals should consult their financial professional before implementing their investment plan.