It’s Time for Your Midyear Check-In

PHOTO CREDIT: SHUTTERSTOCK

Now is the time to assess and make changes to help ensure your financial security in retirement.  

A good retirement plan doesn’t collect dust. Like any living document, it should evolve with changes in your income, investments and lifestyle. Any notable changes should also lead to adjusting your retirement plan. 

Regardless of where you are in the process, it’s always a good idea to review your retirement plan every six months. You should take the time to make adjustments now to help ensure you have the financial resources and income you’ll need to enjoy your retirement later. 

Reviewing Your Plan

More Americans are living longer, which is great news. But that comes with a new challenge – we need our money to last longer in order to avoid the risk of outliving our retirement savings. To determine if you have enough protected income to at least cover essential expenses in retirement, you should carefully review two critical things using the “check off the basics” approach: 

1. Step 1: Start by adding up your essential monthly expenses – those monthly bills you know you have to pay for like housing, healthcare, food and utilities. It’s also a good idea to consider the expenses for enjoying your retirement like travel, entertainment and gifts to family members. 
   
   
2. Step 2: Once you’ve calculated the money you must have every month or year, step two is to create a plan to make sure you have enough protected lifetime income to fill any gaps in income and that can help cover those basic expenses.  

As you’re “checking off the basics,” keep one very important thing in mind: there are only three sources of protected lifetime income that are guaranteed and can be used to help cover those essential expenses – a pension, Social Security and an annuity. 

Are your Social Security, pension and savings enough to provide the income you need in retirement? Are your market investments performing well enough to provide a steady income when you need it and that will last? A financial professional can help you translate this simple exercise into a true retirement income plan that you can count on. He or she can help you develop a plan for protected income to help cover those essential expenses and give you the confidence to use your other savings to pay for the great things you always wanted to do in retirement. If you see a gap between your protected income and anticipated expenses, now is the time to make adjustments to help protect your retirement. 

Closing the Gap – the Annuity Solution

If you are coming up short after “checking off the basics,” annuities may be a great way to help close the gap between the protected income you have and what you will need. An annuity can provide guaranteed income for life that can help supplement what you receive from Social Security and a pension (most have disappeared, so you’re lucky if you have one).  

Annuities also offer tax-deferred growth – you only pay taxes when you start receiving income from your annuity. Many annuities offer the ability to protect your principal, where the initial money you’ve invested is not at risk due to market losses. The security and peace of mind you’re likely to get from this type of solution may help you plan your financial future with more confidence.  

Your RISE Score® – Know Where You Stand

Will there be a gap in your retirement plan between what you’ll have and what you’ll need? There’s a simple tool that can help you find out. The “RISE Score (Retirement Income Security Evaluation)” analyzes your income, expenses and the risk level in your retirement plan. It then generates a score that projects any gaps in your plan and how likely you are to outlive your money. It’s like a credit score for retirement. 

Click here to discover your RISE Score using the easy-to-use calculator by the Alliance for Lifetime Income. 

Once you’ve got your score and checked off the basics in your retirement plan, talk to your financial professional. He or she can help you figure out how to cover your essential expenses so you can live that great life you want in retirement.   

^{The Alliance for Lifetime Income is a non-profit educational organization that raises awareness and educates Americans about the value and importance of having protected income in retirement. The Alliance has tools and resources to help you better prepare for your financial life in retirement.}  

^{All information provided is anonymous and strictly confidential, and it will not be shared with other parties.}