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Preparing for Retirement: How to Accumulate and Safeguard Your Earnings

Camarda Wealth Advisory Group

Are you in the final years of your career and wondering if you’ll be comfortable in your golden years? After working for decades, you want to enjoy your retirement years.

But a solid retirement doesn’t just happen. You need sound financial strategies in place to protect your future financial security.

Even if you’ve been diligent about preparing for retirement, life has a way of derailing your plans. That’s why a solid retirement strategy is so important.

Here’s how to accumulate and safeguard earnings to meet your retirement goals.

Map Out Your Retirement Needs

If you were planning an overseas trip, would you go into it blindly or would you plan for it? If you plan for other big events in life, why wouldn’t you plan for retirement?

Before you retire, you want to consider your expected retirement income and spending needs. Once you stop working, that steady income you count on is suddenly gone.

You need a retirement strategy that works for you for the duration of your retirement years. Think about your current lifestyle and how your retirement lifestyle may differ.

Will your home be paid off? Will your children be out of the house? What activities are you planning to pursue? There’s so much to consider.

You must consider your outstanding debts and your plans to address what you owe before you retire. Understanding what your financial needs will be can help you set retirement goals and create a plan to achieve them.

Prepare for a Lengthy Retirement

With advances in wellness, technology, and healthcare, people are living longer than ever. You could spend several decades in retirement. In fact, your retirement could span up to a third of your lifetime.

Running out of money is a real problem for today’s retirees. Your income must last as long as you need it, but it’s hard to predict how long your retirement years may be.

An effective strategy is to make a 30-year plan for retirement. If longevity runs in your family, you may have a clue about the years ahead of you.

Developing a long-term financial plan is beneficial for ensuring you’ll live comfortably for all the years of your retirement. This type of proactive financial planning can bring you peace of mind.

Seek Professional Financial Guidance

Retirement planning involves many moving parts. A financial professional brings a wealth of knowledge and experience to the table to help you plan for retirement.

You may have worked with a financial advisor in the past whose goal was to help you accumulate wealth. In retirement, the focus shifts to the distribution of assets or tapping into your investments to provide retirement income.

The goal is the preservation or protection of your wealth so you have enough to live comfortably in the years to come. That’s why it’s important to have a financial advisor who understands the nuances of retirement planning.

They should have experience helping others achieve financial security in retirement. They should look at your financial situation and consider your long-term goals.

Based on your current financial situation and your needs for the future, they can help you create a retirement plan that’s tailor-made for you.

Accumulate and Safeguard Earnings

You already know you should be saving money for retirement, but are you saving as much as you should? Take a look at your savings progress to see if it’s time to increase your savings.

Savings goals vary depending on your age and income. Most financial experts agree that you should try to save 15% of your yearly income.

If you have the benefit of a 401(k) plan with an employer match or another workplace retirement plan, you should take advantage of it. This gives you “free money” you would not have without this added benefit.

Diversify Your Portfolio

As you get closer to retirement, a diversified portfolio is essential for risk mitigation. Diversification helps to spread the risk out across your investments.

A well-diversified portfolio helps protect your savings as markets fluctuate. This is especially important during the retirement risk zone years, which lead up to and immediately follow retirement.

This doesn’t mean you should only invest in different types of stocks, though. It’s essential to consider different asset classes as well.  Having the right mix of asset classes – for example, stocks, bonds, CDs, real estate – adds additional diversification to your portfolio and helps to further mitigate risk.

Consider Healthcare and Inflation

As inflation rises, it eats away at the purchasing power of your retirement income. Inflation has to be considered as you plan for your golden years.

Your spending could increase by a certain percentage each year, such as 2 to 3%, so you have to be prepared for this possibility. A professional financial expert can help you plan and refine your retirement goals to account for inflation.

Healthcare is also a major consideration for those approaching their retirement years. It should be a factor in your retirement income planning.

Explore avenues for stretching your healthcare dollars. Long-term care insurance, life insurance, and annuity products may be good options.

Medicare supplement plans and cost-saving prescription plans can help provide some financial relief as well. If your employer offers continuing health coverage for you or your spouse, it’s worth looking into.

Be sure to seek the advice of a financial professional for their input on these options for your retirement.

Maintain an Emergency Fund

There’s one thing you can count on for sure. Life will throw you curve balls, and they can be expensive.

It’s always a good idea to have an emergency fund that’s separate from your investments. This cash can help you cover unforeseen expenses and prevent you from having to dip into your retirement money.

An emergency fund that covers six months of monthly income is a good place to start. Healthcare care and housing costs can rise and eat away at your retirement savings.

An emergency fund can help you be ready for these situations. It’s always a good idea to reduce your expenses in other areas to help you save for an emergency fund.

Consult a Qualified Financial Expert

If you’re planning to retire in the coming years, the actions you take now can help you accumulate and safeguard earnings. There are steps you can take right now to prepare for a comfortable and enjoyable retirement.

Retirement saving and planning are more complex than you may think, and it’s wise to consult a financial professional to help you create a sound financial strategy for retirement.

Camarda offers PhD-led and nationally recognized wealth management services. We will consider your goals and help you plan for the retirement you really want.

Contact Camarda today to discuss your retirement needs.

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