Whatever you call it — “it” being that blissful state of having enough money to quit work and do what you want — our aim with an upcoming series of articles is to help you achieve it.
If all you’ve ever done to plan for retirement is dream about which beach you’ll be spending it on, you’re not alone. After all, only 4 in 10 people say that they and/or their spouse have ever tried to figure out how much money they need to save for retirement. But planning for retirement is a key part of saving enough money to enjoy retirement.
1. Develop a Written Retirement Plan that Identifies Your Values and Lifestyle Preferences
It probably won’t shock you to know that people who have a written retirement plan feel more prepared for retirement. What might surprise you, though, is how easy it is to get a plan in place that will push you to feel more confident about your future.
2. Stress Test Your Plan
In healthcare, a stress test, sometimes called a treadmill test or exercise test, helps a doctor find out how well your heart handles work. Similarly, a financial stress test is an analysis conducted under hypothetical unfavorable economic scenarios, such as a deep recession or financial market crisis, designed to determine whether your retirement plan has enough capital and diversity to withstand the impact of adverse economic developments.
3. Understand Your Buckets
The premise of Bucketology is a strategic distribution of your wealth between three buckets: Cash, Non-Tax Deferred (brokerage, stocks, and bonds), and Tax Deferred (IRA, 401(k), and 403(b) accounts). It is the art of balancing your portfolio and distributing your wealth to manage your taxes, cash flow, and risk.
4. Experience Behavioral Investment Counseling
Why do most investors under-perform their own investments? “Most Americans are either fearful or greedy. It is their behavior that gets in the way!” Behavioral Investment Counseling educates the investor's behavior to produce an informed strategy that can withstand the test of recessions and pandemics.
5. Use a Wealth Management Consultative Process
Does your financial advisor use a proven process to help you manage your wealth? Or, to put it bluntly, is he or she simply winging it? As it is with reaching any goal in life, your odds of success rise dramatically when you approach it with a process. At Questmont, we believe that effective preparation and consistent effort are at the heart of sustained success.
Over the coming weeks we will be posting more information about each of these steps so stay tuned and keep an eye on your inbox. If you have any questions about these articles or your financial plan, please contact us. The Questmont team is here for you!