Simplify Your Retirement
Nov 22, 2021
S3: Episode 10 – Enjoying Retirement Requires Planning
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What does retirement look like to you? How do you plan to enjoy your retirement? In this episode, Stephen Stricklin is joined by clients Barry and Linda, who share how they are enjoying retirement, and how planning has made their retirement successful. He is also joined by a client, Jeff, who discusses the plans he and his wife Janie have for their own retirement. They discuss: Barry and Linda’s experience living in an RV and travelling around the United States in retirement Jeff’s experience living on a lake with his family and what their future retirement plans hold Barry and Linda’s advice for retirement planning and what they wish they had done sooner Jeff shares what he’s been doing to ensure his daughter’s future, and why having a plan is so important And more Connect With Stephen Stricklin: stephen@wisewealth.com WiseWealth.com Simplify Your Retirement LinkedIn: Stephen Stricklin LinkedIn: Wise Wealth LLC
More episodes from Simplify Your Retirement
4 days ago
Season 5 Episode 5 Income Planning: Smart Investment Allocations for Maximum Peace of Mind
Income Planning: Smart Investment Allocations for Maximum Peace of Mind
We understand that when retirees have a well-thought-out plan, they are more likely to experience true freedom. The ultimate goal of our retirement planning efforts is to achieve this freedom, enabling individuals to give, serve, and enjoy life without constraints.
Once a plan is established for each of these six areas: liquidity, income, growth, tax, legacy, and insurance, true freedom becomes attainable.
Our concept of freedom planning perfectly aligns with the mission of Wise Wealth, encapsulated by the hashtag #GSEL (give, serve, and enjoy life). To realize this vision, meticulous planning is necessary.
One of the most pivotal questions to ask in financial planning is, "What does retirement look like to you?" This question is crucial as the answer varies for each individual. Retirement, for some, entails serene moments in a rocking chair or spending time with grandchildren, while for others, it means constant travel and never staying at home. There's no right or wrong answer, but an answer is essential.
The response to the question "What does retirement look like to you?" not only carries an emotional aspect but also a numerical component. When we discuss income planning, we are essentially determining that number.
At Wise Wealth, one of our guiding principles is that the plan determines the products. Using our easy-to-understand “3-Bucket Approach” we identify the purpose of the money—whether it's for liquidity, income, or growth. and we firmly believe that a single portfolio cannot effectively serve all three purposes.
We believe a single portfolio cannot effectively serve all three purposes. Aligning investments with their intended purposes simplifies decision-making and enhances peace of mind.
Today, our focus shifts to the income bucket. We'll discuss the rules governing how much should be allocated to this bucket and the investment options it offers.
Many individuals approaching retirement, particularly those who have managed their finances independently or worked with advisors focused on asset growth, may find this transition challenging. They are accustomed to growing their assets, often through 401(k) investments.
However, in retirement income planning, the dynamics change, requiring consideration of liquidity, safety, income, and growth.
Many people mistakenly believe they only have these two extreme options, either taking no risk and accepting minimal returns (barely keeping up with inflation) or risking everything with potential losses as the market fluctuates. The downside is that this type of strategy doesn't lead to freedom or peace of mind. Individuals find themselves in constant fear, tied to market fluctuations, questioning every financial decision.
There are alternative options in the middle ground, that are less risky and more cost-effective, giving a more balanced approach.
Upon reaching retirement age, individuals should protect the portion of their money needed for an income stream. The rules for the liquid bucket involve determining your income number, solving for the gap by subtracting guaranteed income sources, and figuring out the least amount of assets needed to guarantee the required level of income.
Almost everybody has an income gap, and the income gap formula is straightforward. Take your income need in retirement, subtract any guaranteed income sources, and start with a clear budget. To determine your income need, write it down—request our complimentary retirement worksheet at info@wisewealth.com.
Our goal as planners is not to sell annuities or CDs but to have as much money as possible growing for our clients while protecting their income needs. We advise individuals, even up to the first 5 to 10 years in retirement, to start allocating assets today to solve for that gap 10 years from now.
It's never too early to start planning.
To request your copy of our book, “Simplify Your Retirement,
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Nov 22, 2023
Season 5 Episode 4 Liquidity Planning: How to Plan and Budget Expenses in Retirement
In planning for retirement, creating a budget is crucial for ensuring financial security and making work optional. The simplified approach involves dividing assets into three buckets: one for liquid expenses, another for income, and the third for growth.
The budget, a formal plan for managing monthly income, helps avoid overspending and provides the freedom to enjoy retirement.
Key points on budgeting for retirement:
Living Expenses vs. Lifestyle Expenses:
Distinguish between essential living expenses (e.g., housing, utilities, food) and desired lifestyle expenses (e.g., travel, recreation). Guaranteeing living expenses is crucial.
Start with the Basics:
Ensure a secure retirement by covering the necessities. Just as parents promise a roof, food, and clothes for their children, retirees should guarantee their own living expenses.
Healthcare Costs and Inflation:
Estimating healthcare expenses is a significant concern in retirement. A reasonable starting point could be $450 per person per month. Account for inflation in estimating future expenses. Regularly monitor and adjust the budget as circumstances change.
Customization is Key:
While there's no one-size-fits-all solution, everyone needs to identify their unique retirement number. Use a budget worksheet, estimate high, and adjust for inflation over time. Six months before retirement, start living on the budget to ensure its feasibility. Adjustments can be made based on the real experience.
Remember, the goal is to retire with confidence, peace of mind, and the freedom to enjoy life without financial constraints.
đź“… SCHEDULE A CONSULTATION:
816-246-WISE (9473) | info@wisewealth.com | www.wisewealth.com/contact-us
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Nov 8, 2023
Season 5 Episode 3 Liquidity Planning: How to plan for short-term needs and where to invest
Liquidity Planning: How to Plan for Short-Term Needs and Where to Invest
Liquidity is important for everyone, no matter what phase of investing you are in. If you anticipate needing your money within the next five years, it should be readily accessible. The primary objective is to ensure the protection of your income stream and have assets at your disposal.
It’s impossible to grow your income, draw an income stream, and keep it liquid all in one portfolio.
In our 3-bucket approach, funds are distributed into 3 categories: liquid, income, and growth. Anything in the liquid bucket will not be available for growth or income.
There are two reasons someone may want to have liquid assets:
1. Emergency Fund: The recommended amount for an emergency fund may vary depending on your current investment phase.
2. Short-Term Expenses: These are expenses you anticipate in the next five years, such as buying a new car, funding house repairs or renovations, or taking trips.
The objective here is to safeguard this money from market risks. If your financial goals are within 1-3 years, there may be an alternative investment to consider besides a checking account. These could include cash alternatives such as CDs, money market accounts, fixed annuities, or specialty savings accounts. Most people think that having money liquid means it doesn’t earn anything. That is not the case with these alternatives.
Contact our team of professionals for more information about the current return on specific accounts that could benefit you.
816.246.WISE (9473) or info@wisewealth.com
With our Simplify Your Retirement Plan® Process, your income stream will be guaranteed and the plan ultimately leads to financial peace of mind so you can live the retirement you always dreamed of.
Wise Wealth is an education-based financial planning firm that specializes in retirement.
đź“… SCHEDULE A CONSULTATION:
816-246-WISE (9473) | wisewealth.com/contact-us | info@wisewealth.com
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