What motivated you to start preparing for retirement?
As part of its 2024 survey, Fidelity Investments posed that question to more than 2,000 investors and here’s what they found:1
Nearly half (46%) of Americans said it’s “something they’re supposed to do.” In other words, nearly half of Americans woke up one day and said, “You know, I’m supposed to prepare for retirement.” That can be an unsettling realization for some, especially if they feel like they are getting a late start.
Another 40% said they started preparing because they knew the potential consequences of not preparing for retirement. Most psychologists say that this type of negative reinforcement is not a great way to get ready for a major life event. It can lead to anxiety and stress, which often results in short-term behavior changes rather than building long-lasting positive habits.
As we prepare you for retirement, we have a more proactive approach that takes into consideration a wide range of factors. So, when retirement day arrives, you have a strategy in place that can guide your decision making and help you respond to unexpected events.
“You can make many plans, but the Lord’s purpose will prevail.” Proverbs 19:21
Here’s a short list of some items we discuss as we create your retirement roadmap:
Visualizing retirement
“Retirement planning should start in your head, not your bank account,” wrote US Bank’s Wealth Management team. We could not agree more. When you have a better understanding of what’s important to you, your retirement strategy naturally follows.2
Matching income and expenses
Northwestern Mutual’s 2024 Planning & Progress study found that adults guess that they will need $1.46 million to retire comfortably–a 15% increase over the prior year. However, guessing is not a retirement strategy. Assessing your income and reviewing your expenses can help you feel more confident about your preparations.3
Health insurance
What’s the #1 worry for today’s retirees? It’s declining health or illness, closely followed by managing healthcare costs. A proactive approach might help ease some of your healthcare concerns.4
Social Security
The topic of Social Security is often followed by a lot of questions, including “When should I start claiming benefits?”, “Can I collect benefits based on my spouse’s earnings?”, “How are my benefits calculated?”, “Will my Social Security benefits be taxed?”, “What happens if I continue working while receiving benefits?” Retirement confidence builds when you have more answers.
Tax management
When you retire, you transition from accumulating assets and begin the process of taking distributions. But what money should you spend first? Tax management can play a role as you build your distribution process.5
Buyout packages
A 2024 retirement survey found that nearly 60% of people retired earlier than they had expected, often due to corporate downsizing. Some companies offer buyout packages to encourage employees to retire early. In those instances, you may need to adjust your retirement strategy so you can consider what role the buyout package will play.6
One thing we’ve learned over the years: no two retirements are alike. Each family brings a unique set of ideas and concerns, which allows us to create a one-of-a-kind strategy designed to grow with you.
- Fidelity.com, 2024
- USBank.com, 2024
- NorthwesternMutual.com, April 2, 2024
- CNBC.com, October 14, 2024
- Schwab.com, January 10, 2024
- EBRI.org, November 13, 2024
