FINANCIALLY
Speaking
1 .
Jeffrey M . Orth is a Chartered Financial Consultant , a Certified Advisor in Senior Living , and an Investment Advisor Representative , with over 15 years of experience as a business and personal planning , insurance , and wealth management specialist . Jeff is available for group lectures and private consultations . Visit ifitfinancial . com or call 408.842.2716 .
The author ’ s opinions , comments , information , etc . are those solely his own and are independent of , and do not represent , HTK , and should not be considered as specific investment or planning advice . Please consider your options based on your individual circumstances . Past performance is not indicative of future returns . gmhTODAY and other listed entities are independent of and unaffiliated with , HTK and Integrated Financial Benefits Network ( IFit ).
Retirement : Ready or Not
As a young man , I remember having a number of conversations with my grandfather about the importance of saving for the future — saving for retirement . Back then , retirement planning was much simpler , as the average man retired at age 65 and died 2½-5 years later . The plan was : save some money and keep it safe . How things have changed ! I currently plan on my clients being in retirement for 30 years . In some cases , they will spend more years in retirement than they did in their working years . When you need to plan for three decades of retirement , inflation becomes a much bigger issue , as your buying power erodes with each passing year . Investment mistakes become more damaging to the overall success of your retirement plan , as you aren ’ t able to go and “ earn your way out ” of the problem . Having guarantees that adjust for inflation and protect your investments also become more and more important .
So the good news is people are living longer , but the bad news is that people are living longer ! And if you are like a lot of people , you are more concerned about running out of money before you run out of life , than you are about dying too soon .
As a Chartered Financial Consultant , I always take stock of what assets my clients currently have in place and determine what a successful retirement looks like for them . Then , we work backwards from that goal and try to plan with the end in mind . To do this , we need to answer some questions that may make some feel uncomfortable , as they realize they either don ’ t know the answers , or realize how unprepared they are for retirement .
Do you have the answers to the four toughest financial questions everyone needs to know ?
• What rate of return do you have to earn on your savings and investment dollars to be able to retire at your current standard of living , and have your money last through your life expectancy ?
• How much do you need to save on a monthly basis to be able to retire at your
… the good news is people are living longer , but the bad news is that people are living longer !
current standard of living and have your money last through your life expectancy ?
• Doing what you are currently doing , how long do you have to work to be able to retire and live your current lifestyle until life expectancy ?
• If you don ’ t do anything different than you are doing today , how much will you have to reduce your standard of living at retirement for your money to last for your life expectancy ?
To answer these questions with any degree accuracy requires :
• Calculators that are sophisticated enough to handle a large number of variables at one time .
• An advisor capable of handling timing issues related to post retirement asset consumption .
A good investment plan is as much about avoiding loss as it is about the rate of return . Most people are ‘ transferring wealth ’ ( aka : losing money ) from their own estate unknowingly and unnecessarily . They are not only losing the money , but also the additional money it might have earned for them . This is called “ opportunity cost ”. There are a number of great tools currently available that are designed with loss prevention in mind . As one approaches and enters their retirement years , it becomes even more important to reduce risk exposure while maintaining healthy growth . Timing issues are critical as well in any retirement plan . Knowing which asset to use and when to use it can have a significant impact on ‘ the bottom line ’. For example , I have found that knowing when to turn on each spouse ’ s Social Security retirement benefits alone can at times make more than a $ 250,000 difference in a couple ’ s lifetime retirement income *.
Life in retirement will be a lot more enjoyable if working longer is something you do because you want to , not because you have no choice . If you are forced to stop working earlier
Continued on page 106
2032282MS _ Mar20
Registered Representative of , and Securities and Investment Advisory services offered through Homor , Townsend & Kent , Inc . ( HTK ). Registered Investment Advisor Member FINRA / SIPC , 16845 Von Karman Ave , Ste . 225 lrvine , CA 92606 ( 949 ) 754-1700 . I Fit is unaffiliated with HTK . CA Insurance Lic # 0C49291
24
GILROY • MORGAN HILL • SAN MARTIN APRIL / MAY 2018 gmhtoday . com
FINANCIALLY
Speaking
1.
Jeffrey M. Orth is a
Chartered Financial
Consultant, a Certified
Advisor in Senior Living,
and an Investment Advisor
Representative, with over
15 years of experience as
a business and personal
planning, insurance,
and wealth management
specialist. Jeff is available
for group lectures and
private consultations. Visit
ifitfinancial.com or call
408.842.2716.
The author’s opinions,
comments, information,
etc. are those solely his
own and are independent
of, and do not represent,
HTK, and should not be
considered as specific
investment or planning
advice. Please consider
your options based on your
individual circumstances.
Past performance is not
indicative of future returns.
gmhTODAY and other listed
entities are independent of
and unaffiliated with, HTK
and Integrated Financial
Benefits Network (IFit).
2032282MS_Mar20
24
Retirement: Ready or Not
A
current standard of living and have your
s a young man, I remember having
money last through your life expectancy?
a number of conversations with my
•
Doing what you are currently doing, how
grandfather about the importance
long do you have to work to be able to
of saving for the future—saving for
retire and live your current lifestyle until
retirement. Back then, retirement planning was
life expectancy?
much simpler, as the average man retired at age
•
If
you don’t do anything different than
65 and died 2½-5 years later. The plan was:
you
are doing today, how much will you
save some money and keep it safe. How things
have
to reduce your standard of living
have changed! I currently plan on my clients
at
retirement
for your money to last for
being in retirement for 30 years. In some cases,
your
life
expectancy?
they will spend more years in retirement than
To answer these questions with any degree
they did in their working years. When you
accuracy
requires:
need to plan for three decades of retirement,
•
Calculators
that are sophisticated enough
infl ation becomes a much bigger issue, as your
to
handle
a
large number of variables at
buying power erodes with each passing year.
one
time.
Investment mistakes become more damaging to
• An advisor capable of handling timing
the overall success of your retirement plan, as
issues related to post retirement asset
you aren’t able to go and “earn your way out”
consumption.
of the problem. Having guarantees that adjust
A
good
investment plan is as much about
for infl ation and protect your investments also
avoiding
loss
as it is about the rate of return.
become more and more important.
Most people are ‘transfer-
So the good news is
ring wealth’ (aka: losing
…the good news is
people are living longer, but
money) from their own estate
the bad news is that people
people
are
living
longer,
unknowingly and unneces-
are living longer! And if you
They are not only
are like a lot of people, you
but the bad news is that sarily.
losing
the money, but also
are more concerned about
the
additional
money it might
people are living longer!
running out of money before
have
earned
for
them. This
you run out of life, than you
is
called
“opportunity
cost”.
are about dying too soon.
There
are
a
number
of
great
tools
currently
As a Chartered Financial Consultant, I
available that are designed with loss prevention
always take stock of what assets my clients
in mind. As one approaches and enters their
currently have in place and determine what a
retirement years, it becomes even more impor-
successful retirement looks like for them. Then,
tant to reduce risk exposure while maintaining
we work backwards from that goal and try
healthy growth. Timing issues are critical as
to plan with the end in mind. To do this, we
well in any retirement plan. Knowing which
need to answer some questions that may make
asset to use and when to use it can have a
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