The New Retirement: Choose to Live Boldly

Your world doesn’t look much like the one your grandparents lived in – and neither will your retirement. But you do have choices that ultimately can lead to a financially secure life. When you deploy a thoughtful plan, you chart a course for the future and create options for today.

Planning Now Gives You Freedom from Worry Later
Even if you don’t have a lifetime pension, you can set goals for each phase of your life, incorporate them into a personalized financial security roadmap and adapt it to stay on course. Implementing a long-term plan gives you the confidence to live boldly today, knowing your future is secure even when some circumstances may be outside your control.

In our comprehensive planning process, a financial representative helps you to define where you are and where you want to be. Together you’ll confirm the best path for your unique situation, needs and interests. Like any journey, there are choices along the way that can move you closer to your destination. What’s important is to have a process that helps you pair your life’s aspirations with a sound financial plan to support them.

Following are some considerations for different stages and needs in life, and choices that can bring you closer to a financially secure future.

Starting Out
As you establish your career and income, explore things you enjoy and seize opportunities that will pay off later, such as professional education, special work assignments, and career-related travel. On the financial side, pay down debts and student loans while also enrolling in employer-sponsored benefits such as a 401(k) match, profit-sharing plan or group insurance. In addition, set up an automatic withdrawal to build your emergency fund (at least six- months’ living expenses) and save for major purchases such as a car or home. This is a good time to establish relationships with trusted advisors and mentors, including a financial representative, who can help access the tools you need and plot the milestones on your path.

Getting Married
Adjusting to life with a partner is both a financial and personal transition. Set yourself on the right course by agreeing on key goals and the right strategy to accomplish them. Purchasing a home, for example, involves a different type of forethought than achieving dreams of international travel. Whatever your aspirations, you can more confidently assess and choose your options when you’ve anticipated and planned for them.

Having a Family
If you want children, perhaps you imagine working part-time, funding childcare and education expenses, and incorporating children and their needs into your long-term plans. You also need to be prepared for risks to your loved ones and your finances. In addition to health care coverage and life insurance, disability insurance is essential to protecting your income if you become injured or unable to work. Depending on the plan, employer-sponsored disability insurance benefits typically pay only a portion of your salary (up to 60%), so you may want a separate, individual policy to provide income to continue implementing your financial plan.

Investing in Education
Whether for your dreams or your children’s, the amount you need to save for college depends on the type of school and degree you’re targeting, the time available for your money to grow, and the percentage of expenses you plan to cover. Besides planning for college costs, you may want to set aside funds for exciting pre-college opportunities now available for students. Numerous online sources explain costs and financial aid, such as www.fafsa.ed.gov and www.collegeboard.com. Start by identifying target colleges and research their current costs online. Your financial plan could include various funding vehicles, such as state-sponsored 529 plans, Coverdell Education Savings Accounts, Roth IRAs and the cash value of permanent life insurance.

Saving for Retirement
Separate from other financial commitments, saving for retirement needs to be a consistent, lifetime process. It’s never too late to start, but the earlier you begin a systematic savings plan the more your money grows through compounding. The best way to prepare is to imagine what your retirement might be like — including activities, lifestyle and expenses—and create a plan that will accumulate wealth to cover the potential costs and risks.

Living in Retirement
You need a new long-term plan to enjoy the retirement you’ve imagined and transition from asset accumulation to distribution. With the possibility of living to age 90 or beyond, you want your funds to last. That’s why the plan typically combines risk protection and multiple income streams, such as guaranteed income from annuities and Social Security to cover fixed costs plus other income for non-essential expenses.

Leaving a Legacy
Life insurance is a tool you can use to leave a legacy to support people and organizations that are important to you. Benefits paid at death are not subject to income tax, making life insurance an excellent tool for transferring wealth to adult children, grandchildren and charitable organizations. You can also make charitable contributions through using the cash value of your life insurance policy, or transferring the entire policy to charity. A gift of permanent life insurance also can be a legacy for grandchildren – it outlasts short-term gifts, giving them a cushion of protection as it accumulates cash value they can tap in the future.