RETIREMENT PLANNING 101

We believe that retirement planning needs to address each of these seven components:

1) Emergency Fund - How are you going to pay for unpredictable expenses that come up during retirement? A medical procedure that requires an out-of-pocket payment, a major car repair, or a trip across the country to a funeral that you weren't expecting.

2) Big Ticket Items - What are the significant, but predictable, expenses that you'll incur during retirement, and how will you pay for them? A new car, a new roof, or college tuition help for a grandchild.

3) Regular Income - Once you walk away from a paycheck at work, it's crucial that you're able to create regular paychecks from other sources to fund your lifestyle. It's important to make the best possible decisions you can with income streams that you already have (like Social Security and pensions) while also creating other income streams to meet your needs.

4) Fun Money - Having enough income to cover your basic needs is important, but you'll probably want to do more in retirement than just pay the bills. For some people it's travel, for others it's golf, for others it's spoiling the grandchildren. Whatever it is that fits your definition of fun, you need a plan for how you'll pay for it all.

5) Growth - Even if you have plenty of income on the day that you retire, inflation will start to eat away at the buying power of that income as the years go by. So it's important to have money that's growing at a rate faster than inflation so that you can use it to yourself a raise every year.

6) Healthcare - Hopefully you'll never end up in a situation where you need to pay for nursing home care, assisted living, or home health care. But if you do encounter those expenses at some point, you'll want to be able to cover those expenses without obliterating the nest egg that you've spent years building.

7) Legacy & Estate Planning - Leaving a financial legacy is more important to some people than it is to others. But if a legacy is important to you at all, you need to be sure that you're passing money to the next generations as efficiently as possible.

Our retirement planning process helps clarify your needs in each of these categories and gives you a roadmap to show you how to address each category effectively.

Call Rosewood Wealth Management at 919-391-3446 today!