We do love it when someone refers a family member or friend to us. Sometimes the question is, “How can we introduce them to you?” Well, there are multiple ways but a very easy way is to simply forward them a link to this webpage.
Here are this week’s items:
The Retirement Checklist Challenge
Radon Stancil and Murs Tariq discuss the Retirement Checklist Challenge, a structured approach to evaluating how prepared you are for retirement. The goal of the challenge is to help you assess your readiness by scoring yourself on 34 key factors that contribute to a Secure Retirement Plan....
Radon Stancil and Murs Tariq introduce a Retirement Checklist covering Retirement Income Planning, Tax-Efficient Retirement Strategies, Medicare and Retirement, Long-Term Care Planning, Risk Management, and Estate Planning for Retirees. The goal of the challenge is to help you assess your readiness by scoring yourself on 34 key factors that contribute to a Secure Retirement Plan….
Today we’re going to walk you through the Retirement Checklist Challenge. This checklist covers five crucial areas: income planning, medical and healthcare, advanced financial planning, risk management, and tax-efficient strategies. Whether you’re preparing for retirement or already retired, this checklist helps you assess your preparedness and identify areas that need attention.
The goal? Score as high as possible—ideally, a perfect 34 out of 34! If your score is lower, it might be time to consult a financial professional to bridge any gaps. At the end of this blog, we’ll tell you how to get your complimentary copy of the Retirement Checklist so you can find your score. Let’s get started!
The Five Key Categories of the Retirement Checklist Challenge
1. Income Planning: Will Your Money Last?
One of the biggest fears retirees face is running out of money. Even if you’ve saved diligently, market downturns, unexpected expenses, and inflation can impact your financial security. The Retirement Checklist Challenge ensures you have a solid plan in place by addressing the following questions:
Do you have a clear budget or spending plan for retirement?
Have you identified your essential and discretionary expenses?
Do you know where your income will come from? (Social Security, pensions, investments, rental income, etc.)
Have you considered tax implications on different income sources?
Have you optimized your Social Security strategy to maximize benefits?
2. Medical and Healthcare Planning: Are You Covered?
Healthcare costs can be one of the biggest expenses in retirement. Planning ahead ensures you’re not caught off guard by unexpected medical bills or long-term care needs. Here are key considerations:
Do you understand your Medicare options and have a plan in place?
If retiring before age 65, have you considered health insurance options?
Have you factored in potential long-term care needs?
Do you have a Health Savings Account (HSA) or other healthcare funding strategies?
Medicare and long-term care planning are critical components of a secure retirement plan, ensuring you have adequate coverage for the future.
3. Advanced Financial Planning: Are Your Finances in Order?
Beyond basic budgeting and income planning, financial planning for retirement involves evaluating fees, estate planning, and overall financial structure:
Do you understand the fees associated with your investment accounts and financial advisor?
Have you reviewed your estate plan (wills, trusts, power of attorney)?
Have you updated beneficiary designations on retirement accounts and insurance policies?
Many retirees overlook estate planning, but having these documents in place protects your loved ones and ensures your wishes are carried out.
4. Risk Management: Are You Prepared for Market Volatility?
Market fluctuations are inevitable, so having a risk management strategy is key to preserving your wealth:
Have you assessed your risk tolerance as you approach retirement?
Does your retirement investment strategy include non-correlated assets?
Do you have a plan in place to protect against market downturns?
Having a balanced mix of assets, including alternative investments, can help minimize risks while still providing growth opportunities. If your risk exposure feels too high, adjusting your portfolio to align with your retirement goals may be necessary.
5. Tax-Efficient Strategies: Are You Minimizing Your Tax Burden?
Taxes don’t stop when you retire—strategic tax planning can help maximize your savings and reduce unnecessary tax burdens:
Have you considered Roth conversions to minimize taxable income later?
Are you taking advantage of charitable giving strategies for tax efficiency?
Have you planned for Required Minimum Distributions (RMDs) from retirement accounts?
Do you have a strategy to minimize Social Security taxation?
Tax planning isn’t just about filing returns—it’s about implementing proactive strategies to reduce what you owe over time.
How to Get Your Retirement Checklist Score
This challenge isn’t just about completing a checklist—it’s about ensuring you have a secure retirement plan in place. If you’re working with Peace of Mind Wealth Management, our goal is that you easily score 34 out of 34!
What If Your Score Is Low?
If your score is below 30, don’t panic! It just means there are areas where you may need professional guidance. Whether it’s retirement income planning, Social Security strategies, estate planning, or risk management, we can help tailor a strategy that fits your needs.
To get your copy of the Retirement Checklist Challenge, simply email us at info@pomwealth.net or call our office at 919-787-8866 and request the Retirement Challenge checklist. It’s a fillable document that allows you to assess your readiness and identify areas for improvement.
Secure Your Retirement with a Plan
Retirement isn’t something you should leave to chance. Taking control now means enjoying financial stability later. The Retirement Checklist Challenge helps ensure you’re on the right track, giving you peace of mind as you approach retirement.
If you’d like more information on this topic, check out the article “Retirement Planning: The Key Steps to Retiring Comfortably”.
We do love it when someone refers a family member or friend to us. Sometimes the question is, “How can we introduce them to you?” Well, there are multiple ways but a very easy way is to simply forward them a link to this webpage. Here are this week’s items:
The High Net Worth Guide to Secure Your Retirement
Murs discuss the essential steps to creating a comprehensive financial plan designed for high-net-worth retirement. Joined by Nick Hymanson, CFP®, they walk through the emotional and financial transition from accumulating wealth during your working years to distributing that wealth to fund your retirement. …..
The High Net Worth Guide to Secure Your Retirement
When you’ve spent your life building wealth, transitioning from work to retirement can feel overwhelming. At Peace of Mind Wealth Management, we specialize in financial planning for retirement, and through our years of experience, we’ve seen what works—and what doesn’t—when preparing for this major life milestone. In this retirement planning guide, we’ll explore the key strategies high net worth individuals should consider……
When you’ve spent your life building wealth, transitioning from work to retirement can feel overwhelming. At Peace of Mind Wealth Management, we specialize in financial planning for retirement, and through our years of experience, we’ve seen what works—and what doesn’t—when preparing for this major life milestone. In this retirement planning guide, we’ll explore the key strategies high net worth individuals should consider, including managing sequence of returns risk, structuring your retirement investment strategy, planning for long-term care, and optimizing retirement withdrawal strategies.
So, whether you’re wondering “is it time to retire?” or trying to decide “when should I retire?“, this comprehensive guide will walk you through what it takes to secure your retirement.
The Shift From Work to Wealth
For many high-net-worth individuals, the hardest part of retirement isn’t financial—it’s emotional. After decades of saving, shifting from earning a paycheck to relying on your wealth can feel uncertain. The fear of running out of money or not having enough for the lifestyle you envisioned is real, but with the right strategy, it doesn’t have to define your retirement.
Along with the fear of running out of money comes questions like:
What if the market crashes early in my retirement?
How can I protect my wealth from unexpected downturns?
How do I protect myself from rising costs like healthcare and inflation?
These concerns are valid. Fortunately, there are proven strategies to protect against these risks.
Managing Sequence of Returns Risk
One of the most significant but least understood dangers to high net worth retirement is sequence of returns risk. This risk refers to the impact that the timing of poor market returns can have on your retirement savings, especially when you’re making regular withdrawals.
Consider this: Two retirees each start with $1 million. They withdraw the same amount annually and average the same return over a decade. But one retiree experiences negative returns in the early years of retirement, while the other experiences those negative returns later. Even with the same average return, the retiree who faced early losses may run out of money much faster.
This is why managing sequence of returns risk is critical. Having a retirement investment strategy that prepares for market downturns from the start helps protect your assets, ensuring you can keep paying yourself for decades to come.
The Three Bucket Strategy: Building a Solid Investment Foundation
Cash Bucket: This is your easily accessible money. It’s held in high-yield savings or money market accounts and is designed to cover emergencies and short-term expenses. For some, this might be $20,000. For others, several hundred thousand dollars. The right amount depends on your comfort level and cash flow needs.
Safety and Income Bucket: Designed to provide predictable income with limited or no market risk, this bucket covers your essential expenses. The goal is to generate a stable return—typically in the 4% to 8% range—to fund your retirement withdrawal strategies without worrying about market volatility.
Growth Bucket: This is your long-term growth engine. Invested in the market through stocks, ETFs, and alternatives, this bucket is meant to outpace inflation and support your financial needs 10, 20, or even 30 years into retirement.
By strategically allocating your assets into these buckets, you create a system where your essential income is protected while your long-term assets continue to grow.
Long-Term Care Planning for High Net Worth Individuals
Another major concern for retirees is long-term care. Costs for assisted living, nursing homes, and in-home care have risen dramatically and show no signs of slowing down. For high net worth individuals, long-term care planning is essential—not just to cover costs, but to protect your estate from being drained by healthcare expenses.
We work with our clients to create long-term care planning solutions that align with their overall retirement income planning goals. This may include hybrid long-term care insurance, self-funding strategies, or incorporating long-term care costs into the safety bucket of the Three Bucket Strategy.
Tax Strategies in Retirement
A major piece of risk management for high net worth individuals is managing taxes. Many retirees hold significant assets in pre-tax accounts like 401(k)s and IRAs. Without proper tax strategies in retirement, you may pay far more than necessary in taxes over your lifetime.
Tax planning should be integrated into your retirement checklist and considered before you retire. Strategies may include:
Roth conversions during lower income years
Tax-efficient withdrawal strategies
Managing Required Minimum Distributions (RMDs)
Coordinating Social Security and pension income with other taxable income
Crafting Your Peace of Mind Pathway
At Peace of Mind Wealth Management, our process for planning retirement revolves around what we call the Peace of Mind Pathway. Think of it as a GPS for your retirement journey. We help you define where you are today, where you want to go, and how to navigate the bumps along the way.
The Peace of Mind Pathway has three key phases:
Roadmap: We analyze your current financial picture, define your retirement goals, and identify the best path forward.
Implementation: We put your custom plan into action, from investment adjustments to cash flow planning and risk management.
Nurture: We continue monitoring your plan, adjusting as life changes, tax laws shift, and markets evolve.
This process ensures your plan is not only set up correctly but remains optimized for your evolving needs.
Is It Time to Retire? How to Know You’re Ready
Whether you’re five years away from retirement or contemplating if now is the time, having a clear plan is essential. High net worth individuals have more moving parts in their retirement strategies, which means more opportunities—but also more complexity. The earlier you start planning, the more options you have to protect and grow your wealth.
At the end of the day, retiring comfortably isn’t about hitting a magic number. It’s about having a strategic plan that provides reliable income, protects your lifestyle, and gives you peace of mind.
To learn more, read the article “Is It Time to Retire? Key Considerations”.
Ready to Secure Your Retirement?
By building a thoughtful plan that includes strategies for retirement income planning, risk management, long-term care planning, and tax strategies in retirement, you’ll be well on your way to retiring comfortably and living the life you’ve worked so hard to create
We do love it when someone refers a family member or friend to us. Sometimes the question is, “How can we introduce them to you?” Well, there are multiple ways but a very easy way is to simply forward them a link to this webpage.
Here are this week’s items:
Portfolio Update: Murs and I have recorded our portfolio update for November 6, 2023
The Art of a Risk-Adjusted Portfolio in Retirement
In this Episode of the Secure Your Retirement Podcast, Radon and Murs discuss the art of building a risk-adjusted portfolio. When building a risk-adjusted portfolio, it’s important to identify your personal risk preference and choose the best model to structure your investment portfolio. Listen in to learn the key differences between passive and active investment styles and the benefits of each in helping you reach your goals.
We’re excited to talk to you about a conversation that we have with every client surrounding risk. Clients who are further away from retirement often don’t mind taking on more risk with retirement planning. However, when you inch closer to retirement age, you want to do everything you can to secure your retirement, and maybe want to take on less risk.
We’re excited to talk to you about a conversation that we have with every client surrounding risk. Clients who are further away from retirement often don’t mind taking on more risk with retirement planning.
However, when you inch closer to retirement age, you want to do everything you can to secure your retirement, and maybe want to take on less risk.
A risk-adjusted portfolio is how we perform a balancing act between risk and growth to help you achieve peace of mind in retirement. This is our philosophy, but this doesn’t mean that it’s the right choice for everyone.
How We Determine Risk Tolerance
Imagine this scenario. The stock market goes up and you’re happy with the gains. However, economic issues cause the market or bonds to swing in the other direction and now you’re down 10, 15, or 20 percent.
At which level do you start to lose sleep at night?
Imagine that you have $1 million to invest and want to go with a moderate portfolio. Most clients believe that they would prefer this option. However, are you comfortable with:
20% – 25% losses?
How about $200,000 – $250,000 losses?
Often, a percentage doesn’t sound that bad until you see the actual dollar amount. Losing $100,000 or 10% of loss is concerning. You may see these figures and be okay with this level of loss, but most of our clients do not have this much of a risk threshold before they begin to lose sleep.
If you’re uncomfortable with losing money at this level, we’ll recommend a risk-adjusted portfolio.
The Two Styles of Investing
Investing can come in two main styles with a bunch of deviations along the way.
Passive Management
Your passive management, such as a 401(k), is common for a lot of people just starting to think about their retirement. You funnel some money into the account, allot 50% to large caps, 25% to medium caps and 25% to small-cap stocks.
In terms of management, you may make a small adjustment quarterly or annually, but you don’t do much more management than that.
You contribute to the account and bet that, in the long run, the market will prevail. For all intents and purposes, this is a passive management strategy.
Younger investors may be fine with passive investing because, in 30 years, they may not be retired. When you’re 55 or older, you don’t have the luxury of 30 years for market corrections.
Active Management
An active management strategy is more hands-on and may include active money managers and financial advisors.
Hedge funds may work to actively manage your account to outperform the stock market to the best of their ability. You may also have active management on the side of protecting against significant market drawdowns.
The active manager will make changes to the portfolio to move your money around and reduce your risk of losses.
During the pandemic, we actively managed our clients’ accounts and moved a lot of money to cash while the market suffered losses. Our clients ended up far better thanks to this approach when compared to the significant losses in the stock market.
Every strategy has years where it outcompetes the others and years when it underperforms the other.
We like to have a portfolio that has multiple parts:
Tactical, which is risk on and risk off, depending on what’s happening in the market.
Core, which is always invested, but what is invested can be rotated throughout the year. Rotations often occur quarterly.
You can cut your risk considerably by having a tactical and core approach. Risk-adjusted portfolios include multiple layers of investment that will help you reach your retirement goals. Our most common portfolio option is moderate growth.
What a Moderate Growth Portfolio Looks Like
Our moderate growth portfolio has many elements, including:
Equity element. In the equity element, there are strategic, core and tactical investments. If we go into a period of high volatility, the core will remain invested because things are okay over time. The tactical area will begin to adjust to hedge risk by reducing equity exposure and moving toward fixed asset exposure.
Structured notes. If you’re still not comfortable with the risks, we will move into structured notes. These notes are available to our clients due to our buying power. We negotiate with the banks, structure a note, and have a rate of return. Right now, the annualized return for these notes is 7% – 11%, so they’re much better than a CD or money rate. Structured notes have inherent risks, but they’re lower than most other options.
A breakdown of our moderate growth portfolio right now is:
38% in the core sleeve, always investing and rotating based on the equity market
38% in the tactical sleeve, which we can turn risk on and off as necessary
24% (max) in structured notes
Structured notes help smooth out a portfolio, especially when you have ups and downs like we’re seeing in 2023. These notes often include a coupon, which offers interest on the account every month.
If a scenario occurs where we need lower equity exposure, we may move into a moderately conservative portfolio that adds bonds or ETFs as a way to lower exposure. We would likely put 30% core, 30% tactical, 24% structured notes and 16% in fixed income.
Clients who don’t want much risk in their portfolio benefit most from this type of portfolio. Many people don’t want 100% risk of the S&P 500, which, over the last 30 years, is a 58% drawdown.
You would lose $580,000 of your $1 million portfolio in the scenario above.
Risk will fluctuate throughout your retirement funding, but when you reach closer to the time when you can finally retire, it often makes sense to mitigate risk as much as possible. You have a dream retirement in mind, and we want to help you reach it.
It takes 15 – 20 minutes for us to have a risk tolerance assessment with you to help you understand what your personal risk preference is because it will let you have the most peace of mind.
