Joe Lucey

Some people set a particular age when they want to retire. It might be more helpful to look at your financial schedule to establish a retirement date. Just because you want to retire on a certain birthday doesn’t mean you’ll be quite financially ready to do so. After all, there’s more to retirement planning than just paying off your mortgage.

Consider the following list of 16 things to do before the big day.

1. Pay off all major debt obligations, including auto loans, credit card balances and the mortgage for your primary home and any vacation properties.
2. Consider life insurance needs — do you need a death benefit for your spouse, or do you have enough for both of you in retirement income sources? Do you want to ensure a legacy for your children or grandchildren?
3. Consider long-term care insurance — discuss your current situation and needs with a financial professional to help determine the long-term care insurance options that may be appropriate for you.
4. Consider an additional source of steady and reliable income, which may mean repositioning a portion of your investment portfolio to protect those assets from market risk and create a lifelong income stream through the use of insurance products, such as annuities.
5. Conduct a house check — see what major repairs may be needed at some point during retirement, such as a new roof, water heater or HVAC system. Have appliances checked out for an estimate of how long they may last.
6. Do any remodeling that’s been on your mind for a while; consider keeping a spare bedroom for future live-in help.
7. Get your house outfitted to accommodate your needs in the future. It may seem unnecessary now, but it’s best to make these upgrades before you’re on a fixed income. Consider adding handrails to the porch stoop, grab handles in the bathroom, rearrange kitchen cabinets so the things you use the most are the easiest to reach, replace doorknobs and faucets with lever handles that are easier to open; if your house has several stories, consider moving your bedroom to the ground floor.
8. Assess how long your cars should last; consider trading in/purchasing a new one if it looks like you might be saddled with repairs on an older car.
9. Put together an emergency fund to help cover costs likely to be incurred later on, from replacing the roof to buying a new car. Even pad it for financial support you may need to provide your children or grandchildren in the future.
10. Work with a financial advisor to conduct a full assessment of current and future expenses to see what can be eliminated (work clothes and dry cleaning), new expenses (taking up golf) and expenses that will “trade out” as you age (travel budget for more health care spending).
11. After you figure out how much your expenses could potentially change over the years, develop a budget for each phase of retirement.
12. Work with a financial advisor to help coordinate Social Security benefits with your personal savings and investments withdrawal strategy. It’s important to know that financial advisors are able to provide you with information but not guidance or advice related to Social Security benefits.
13. Consider downsizing now or in the future, based on lifestyle plans. For example, if you plan to travel extensively, it may be easier to maintain a condo rather than a large house. If you plan to settle in, garden and spend time at home, keeping the family house may make more sense. However, create a contingency plan for later years in case one or both spouses need assisted or full-time care.
14. Even if you don’t downsize, consider making an inventory of your possessions and getting rid of clutter you don’t need and passing on unused furniture and housewares to your children.
15. Work with an attorney to establish an estate transfer plan and communicate it to all family members. Review it every few years to ensure it’s still relevant and reflects your wishes.
16. Complete paperwork for medical directives and powers of attorney.

This is quite a laundry list, and it’s likely that once you get started, you’ll think of other things you should do. But consider the reassurance you’ll enjoy if you get most of these things done before you retire.

Guarantees and protections provided by insurance products including annuities are backed by the financial strength and claims-paying ability of the issuing insurance carrier.

The content provided here is designed to provide general information on the subjects covered. It is not, however, intended to provide specific legal or tax advice.  Contact us at info@securedretirements.com or call us at (952) 460­-3260 to schedule a time to discuss your financial situation and the potential role of investments in your financial strategy.

The economy has grown, in large part, because consumers are spending more money. It remains to be seen whether that trend will continue as more of the massive baby boomer generation approaches retirement.

Even before people retire, many tend to slow down their spending habits. Part of this is lifestyle driven; by age 50, most consumers have bought a home, furnished it, sent their kids off to college and are reining in their household budget.

The highest years for earning often come just before retirement but that’s also the time with the least amount of growth in income. According to studies conducted by the Federal Reserve Bank of New York, young adults see the fastest income increases. Those increases slow mid-career, and by the time we’re in our 50s, our hard-earned salaries could represent negative real wage growth.

Given little to negligible income increases during the latter stages of a career, it is more likely older workers are saving their money for retirement — not pouring it back into the economy. Recent research revealed that 80 percent of baby boomers are cutting back on how much money they spend. Among them:

• 54% reduced discretionary expenses
• 47% reduced recurring monthly expenses
• 35% have created and maintain a household budget

The Congressional Budget Office reports that once the majority of baby boomers retire, government spending as a percentage of GDP will likely increase by another 9 percent due to the jump in entitlement benefits.

Not only will baby boomers likely be spending less as they age, many will continue to work. However, the mix of jobs available to older workers is changing as well. Over the past 26 years, 30 percent of manufacturing jobs have been eliminated, while service-oriented jobs in the education and health care fields have doubled.

 

Every year, the World Economic Forum updates its Global Gender Gap Report, which measures gender disparity across 144 countries and tracks this progress over time. The report pays special attention to the gaps between women and men with regard to health, education, economy and politics.

Although the corporate “glass ceiling” has been broken by a growing number of women, the 2016 gender gap report shows that progress is slowing down for working women both in North America and Europe, while the Middle East and North Africa regions showed the most improvement. The report projects that:

• Western Europe will close the economic gender gap in 47 years
• Latin American and the Caribbean are on tap to close the gap in 61 years
• South Asia may not reach parity for another 1,000 years
• North America has been moving backward since 2006
• At the current pace, it will take approximately 158 years to achieve gender equity in America

One of the high-growth industries that lacks female participation is technology. Although women comprise about half of the U.S. workforce, they account for less than a third of employees at technology companies. 

For decades, educators have tried to reverse this trend. In fact, the number of women studying computer science in college rose to 37 percent in the 1980s, but that number began declining in 1985, and in 2013, women accounted for only 18 percent of bachelor’s degrees in computing. Further, after gaining employment in the field, more women than men are likely to leave. One reason for that is they feel isolated and don’t have the support networks that men have.

Even Melinda Gates, wife and former Microsoft colleague of Bill Gates, has admitted that early on in her career she had doubts about continuing to work in the tech environment day in and day out — observing, “I felt like I had to be argumentative all the time.” It’s not that she couldn’t do the work, but the caustic nature didn’t suit her personality, and she felt there were better ways of getting the work done.

According to the 2017 Global Information Security Workforce Study, 51 percent of women in the cybersecurity industry say they’ve experienced some form of discrimination at work, while only 15 percent of men experienced discrimination. The women surveyed reported unconscious bias (87 percent), tokenism (22 percent) and outright discrimination (19 percent).

Gender discrimination doesn’t harm just women; it’s also bad for business. According to a study by the Peterson Institute for International Economics, having more women in top-level positions correlates with increased profitability. However, the research finds no evidence that, by itself, having a female CEO is related to increased profitability. Stephen R. Howe Jr., U.S. chairman of the study’s sponsor, EY, remarked, “The impact of having more women in senior leadership on net margin, when a third of companies studies do not, begs the question of what the global economic impact would be if more women rose in the ranks.” 

We also are potentially losing out on scientific discoveries and innovations. An academic publisher, Elsevier, conducted a study that found that less than 25 percent of research papers on subjects related to the physical sciences were published by women. It’s possible that we are failing to take full advantage of the scientific brainpower of half of the world’s population.

All of this underlies the necessity for women to have a separate and distinct retirement income plan, even if they are married. With more time out of the workforce, less pay and less opportunity to save and invest for the future, women need to plan for multiple sources of retirement income that are not dependent on spousal benefits. We can help you develop strategies through the use of insurance products for retirement income, both as a couple and with either spouse as a survivor. Please feel free to contact us to discuss how we can help.