Retiring in Manhattan will take an entirely different financial strategy than retiring in Moab, Utah.
The good news it isn’t as bad at 2014.
That’s when the US ranked 19th worldwide in
retirement quality of life according to the 2014 Global Retirement Index (GRI).
The study, conducted by Natixis Global Asset Management, compares 43 countries
in terms of quality of life in retirement.
Today, the US ranks 17th globally, improving
slightly thanks to the strength of the country’s financial institutions,
environmental gains, and healthcare spending. Yet Americans are increasingly
burdened to provide their own retirement savings as companies trim pensions and
healthcare benefits. Saving now for later has become an issue of paramount
The primary factor: quality of life. So how does an employee
create a financially fit retirement objective?
That’s where retirement plan advisors can be beneficial for
plan participants. To help participants design their best retirement plan,
advisors can bring together the myriad of factors impacting retirement
happiness and help participants come to their financial sweet spot long before
they reach retirement age.
Some of the main factors to consider when helping participants design their retirement plans include:
Retiring in Manhattan will take an entirely different financial strategy than
retiring in Moab, Utah. Where your participants are located – or where they
intend to be located post-retirement – affects their general sense of financial
well-being. A $1 million retirement goal may be more than enough in a rural
location, yet not nearly enough to last in a more expensive urban setting.
Income and savings.
Include projected income from the participant’s current position in this
scenario, and always allow for the loss of income for one partner (assume the
unexpected). What other sources of income does your participant intend to draw
from during retirement? How much can the participant realistically save apart
from the retirement investments?
What needs or desires are going to impact those savings accounts? Ask
participants to consider how often they’ll purchase a new car, a new house, a
second property, or if they’ll be financing college for their children.
The same goes for retirement spending – will there be trips, new vehicles, or
other additional expenses? Also, what basic expenses will your participant
expect to have? Will those expenses increase or decrease at retirement age?
Participants tend to paint a glowing picture of their retirement years. But
will they be healthy? Will there be recurring medical expenses from chronic or
possibly terminal illness? If so, how prepared are your participants? Do they
have insurance or a plan in place to offset the expense of long-term care?
Knowing how your participants intend to spend their retirement years – including expenses and their preparations for the unexpected – you can help them develop a retirement investment plan that can keep their dreams in line with reality, which can help improve their financial fitness.
Before leaping into the unknown, we recommend a thorough examination of your plan. Because we are experts in the field, we know the marketplace and know what your existing vendor is capable of offering. Through this examination, we can help you optimize the service you receive.get xpress proposal