Are you saving enough for retirement? How do you know?
What information do you use to determine if you are on track with your retirement goals or if you need to make adjustments to your savings and contributions to reach your target?
Even the most successful, motivated professionals who are taking steps in the right direction can still be at a loss when it comes to identifying their exact retirement goals and the metrics that need to be checked along the way.
As a certified financial planner, I help hundreds of professionals create retirement plans that will give them the best chance of meeting their financial goals in the future.
These are the 6 essential steps for creating a successful retirement plan:
Step 1: Examine your current situation.
To understand where you’re going, you have to know where you are. Gather all of the information that will give you a crystal clear picture of your current earnings, spending, debt, and savings. It’s important to see your WHOLE financial picture, and how your goals work together, not just one investment account.
Step 2: Identify specific goals.
Next, it’s helpful to identify some financial milestones that you want to reach throughout your life and get an idea of what you want your life in retirement to look like. At what age do you want to retire? Where do you want to live and how much money do you anticipate spending to support your lifestyle?
Step 3: Evaluate your progress and your chance of success.
How much have you saved already? Are you currently maxing out your 401K or IRA contributions? Is it going to be enough? A certified financial planner can help you make projections and use sophisticated financial planning software to run calculations to determine if your current savings and contributions will set you up for success in retirement (down to a % of likelihood that your money will last your whole life).
Step 4: Identify courses of action.
This is the meat of your retirement plan. This is where we figure out what changes or adjustments you can make now that will help you hit those targets down the road. These include tax-advantaged savings, smart investment strategies, altering retirement ages or spending, social security maximization, paying off a mortgage, etc. Finding the right strategy or combination that makes sense for you can create a big impact!
Step 5: Implement chosen strategies.
Once we’ve identified areas to focus on and adjustments to make, it’s time to get the ball rolling!
Step 6: Monitor and update.
It’s important to know that a financial plan is not just a printed document. This is a living, breathing plan! Your life and needs change, income goes up and down, and your plan must be adjusted to accommodate that as well.
No matter where you are in your journey, working with a Certified Financial Planning Professional may help you better identify your retirement goals and develop a clear roadmap for achieving them. I’m happy to help. You can learn more about me and my services at www.lighthousefingroup.com or email me at shireen.daniels@lpl.com.