A retirement financial advisor is one of the most important professionals to have at your disposal. Financial planning allows you to create a way to make the most out of your income, ensuring your budget stretches far enough and your income meets your goals both now and into retirement. Retirement planning is not simple. There are dozens of potential obstacles that could slow down your ability to reach your financial objectives.
This is where a financial advisor can help. Not only can they create a plan to build retirement savings, but an advisor can help you navigate difficult periods and overcome risks that are likely to occur throughout your lifetime.
Invested Better can offer some help with this process by making it easy for you to find the best retirement planner for your specific needs. Get matched with a financial advisor in just a few minutes by answering a handful of simple questions. You can then connect with the certified financial planners available to help you make the most out of your investments.
What is Your Ideal Retirement Lifestyle?
As you approach retirement (even if it is decades away), you have to wonder if you are doing enough with your income. Could your current spending be hurting your future dreams of traveling the world? Perhaps you want the best possible way to reduce your tax liability now but also have the ability to build a big nest egg for your future.
One of the first factors to consider in this process is your lifestyle. Your financial planner is not going to tell you what you can and cannot do. Rather, they will tell you what you need to do to achieve your ideal retirement lifestyle.
Consider a few specific factors that could contribute to the retirement lifestyle and financial goals you have:
- Traveling
- Socializing with friends
- Taking on new hobbies
- Consulting and working part-time
- Volunteering
- Contributing to charities
- Supporting your family
No matter what is on your list of the ideal lifestyle during retirement, it helps to work with retirement financial advisors who can help make it possible. You can feel confident that, heading into retirement, you are likely to have the opportunity to achieve those goals.
6 Strategies from a Financial Advisor to Boost Your Retirement Savings
Financial advisors provide you with options. When you work with an advisor, you gain more insight, education, and support. The following are some strategies that could help you build the retirement you desire. However, there is absolutely nothing quite like hiring your own professional who gets to know your goals and needs and can help you with specific investments to earn enough money to create the retirement you desire and who has your best interest in mind. Always consult a professional that’s working just for you. With our simple-to-use free advisor match tool, you can easily find a pro to help you start saving.
Personalized Financial Planning
Retirement planning is more successful when it is designed around your needs and goals. Retirement advisors can help you with this process. Just having retirement money isn’t enough. When you have an advisor who is personalizing your investment strategies, you may see a few key benefits:
- You can build your retirement income (not just retirement savings) so that you continue to earn well into your retirement years.
- You could invest in companies that better align with your personal objectives, goals, and lifestyle views. There’s more flexibility to invest the way you want to invest.
- You can make more informed decisions about the types of investments you make that may not be the standard stocks and bonds. Instead, you may be interested in precious metals or assets. An advisor can help you see the potential risks before you commit.
Retirement goals differ for everyone, and that’s a good thing because it means you’re working towards your long-term objectives and the life you want to live. Not only can a financial advisor help you have more money, but you also have more flexibility in how you build that savings account.
Building a Resilient Investment Portfolio
Diversification is the most important component of building a resilient investment portfolio. Your retirement financial advisor will work very closely with you to create a plan that helps you achieve your goals even when the strategies you initially used may not work or changes in the investment climate happen.
There are various strategies your Certified Financial Planner may recommend. For example, your advisor may offer insight into these areas:
- Asset allocation: What percentage of your assets should be in one type of asset, such as stocks, compared to others? That is dependent on your age and risk tolerance.
- Economic uncertainty: Looking ahead at the next few years and based on your retirement age, your advisor may tweak your investments to better align with your goals.
- Estate planning objectives: The financial products you invest in should be based on your financial goals, and that means that your financial advisor will consider your expectations for inheritance and charity giving.
A resilient investment portfolio can handle the ups and downs of a wide range of risks. That includes political climates, pandemics, and a volatile stock market. The key is having diversification, which your investment management team can offer.
Optimizing Tax Efficiency in Retirement
Your retirement financial advisor is also skilled in helping you minimize taxation. No one wants to pay more than they should in taxes, but most people do not know what specific tax strategies to use to reduce costs. Here are some examples of how your retirement tax strategy could be modified and optimized to save you money:
- Make full use of tax-advantaged retirement accounts, including individual retirement accounts (IRAs) and 401(k) accounts.
- Manage your tax bracket now and during your retirement so you are not paying more than you need to due to unexpected retirement income.
- Take advantage of tax-efficient investments, those that typically offer lower tax risks to investors.
- Consider the value of Roth conversions dependent on where you are in your lifestyle and retirement savings now.
- Determine if a Health Savings Account (HSA) could be a benefit to you to further reduce your tax obligations.
- Factor in tax credits and deductions that may be readily available to you depending on the decisions and investments you make.
Advisors may be able to help you retire with fewer taxes and even protect your estate from taxes after your death. Whether you don’t want to pay taxes when you sell your home, or you are unsure how to minimize taxes on your money once you sell your business, advisors can offer strategies to help with tax planning.
Creating Sustainable Retirement Income Streams
Your retirement financial advisor may work closely with you to not just save money for retirement but also build income streams that can help you meet your expectations for decades to come. Just because you stop working doesn’t mean there are no opportunities to have income coming in.
Your investment advisor could help you determine what your benefits are beyond Social Security benefits, such as:
- Insurance products like whole-life policies that may pay out during your retirement
- Annuities that pay you during your retirement
- Bonds
- Income-producing equities
- Money market accounts
Retirement advisors can help you build a financial plan that enables you to not just be dependent on Social Security for your retirement income but also have numerous other ways to have money coming in that do not require working. Depending on your financial situation, an advisor matches you with the types of financial products best suited for your goals. With this type of retirement planning, you are not just focused on saving enough to meet your lifetime needs. Instead, you’re creating income streams to keep funding your retirement plans for years to come.
Planning for Healthcare and Long-Term Care Costs
Financial advisors are often called on for tax planning and investing decisions, but they can also help with long-term care planning and healthcare costs. Managing these expectations now, during your active working years, is critical. With the help of your financial advisor, you will learn more about ways to plan for healthcare needs and costs later in life.
For example, some advisors may recommend that you invest in long-term care insurance, a tool that may help to cover the cost of nursing homes or other long-term care needs that Medicare does not. You may want to focus on saving money so that you do not have to think about nursing homes, but that may require saving enough to have someone support you in your home. Planning for this now is critical since these expenses can be incredibly high, especially if you need to live in a long-term care location or have support at home for years.
As financial professionals, your retirement advisors are dedicated to preserving your wealth once you reach retirement. That includes estimating and planning for healthcare costs.
Securing Your Legacy Through Estate Planning
Financial planning is not just about retirement planning. While you probably have expectations for how you will live during your final years, many times, you have to think longer than that. Your retirement advisor is able to help you create an estate plan, which gives you ample control over what you leave behind.
A retirement financial advisor will speak to you about your goals and needs in this specific area. Some key considerations for you may include:
- Leaving behind a specific inheritance to your children, grandchildren, or other heirs
- Creating a trust fund to support special goals and needs
- Utilizing trusts to minimize taxation on your property later in life
- Creating care plans for adult-dependent children
- Building wealth that allows you to leave behind money for charities or efforts important to you
- Creating an estate plan that allows you to pass down and protect your business for years to come
- Make key decisions about your final needs, including burials, funerals, and celebrations of life
- Create a plan for all of your assets so they pass down to those you want them to
- Develop financial planning to cover the needs of your minor children, determine who will care for them, and even pay off your mortgage should you die early
Estate planning is one of the main goals many people have and a very real reason to reach out to retirement advisors alone. Even if you do not have a lot of assets to plan for or you are unsure what your wishes for after your life are, working with a retirement advisor now to create a plan can give you peace of mind.
Final Thoughts on Working with a Retirement Financial Advisor
Retirement planning is an incredible task, and some people have the skill, experience, and training to help you make the most out of it. By turning to a retirement financial advisor, you empower yourself to build the wealth you need now, during your lifetime, and a plan for after you are no longer here.
As one of the most important financial decisions of your lifetime, you want to ensure you have the best retirement advisor for you. Utilize our tool to find a financial advisor that aligns with your objectives, needs, and goals. At Invested Better, there’s help for any specific needs you have, even if you do not know what those needs are just yet.
