The Steps To Determine If You Can Retire Show 70

Here’s a quick guide on how to determine if you can retire. Some of our clients come to us when they are approaching retirement, and they're trying to figure out things like:

How should I elect to take Social Security?Do I have enough money to retire?How should I draw my money down or use it?What will my health insurance cost be in retirement?What options do I have for long-term care?

 I’ll briefly break down each of those concerns and tell you how we go about answering these important questions. 

The first step is determining what it takes to pay your bills each month and how much money you need for lifestyle expenses. If you don’t know this number, this is a step one.

Next, we help our folks figure out the best way to claim their Social Security benefits. This decision can literally result in a difference of hundreds of thousands of dollars. If your financial advisor has not talked about your Social Security benefits, ask yourself if you think it’s an important conversation. 

There are hundreds of different claiming strategies and nuances to this decision. We will run a comprehensive Social Security Timing Report that analyzes your choices based on when you claim, what you will earn at your full retirement age, and what life expectancy you’d like to plan for.

No retirement income plan would be complete if it didn’t factor in a reduction of Social Security benefits, because the government has been warning us of this probable eventuality for more than a decade. So, we’ll factor in what a 76% reduction in benefits in 2033 will do to your portfolio. A twenty to thirty percent reduction is what most reports indicate may happen in the 2030s.

When we have the two Social Security numbers, which are what you will earn and what your benefit may be reduced to, we can figure out the most advantageous way to claim benefits. Then, we can move on to the next part of the equation.

Social Security typically only funds 40% of a person’s income in retirement. There are ways to generate income to shore up that funding gap. There are productive ways to allocate your money to equity positions to generate a somewhat reliable source of income, and this is typically achieved by active portfolio management.

Did you see Facebook went offline on Monday for hours? During the course of trading the company’s stock fell more than 5%. Commonly, people will bring their accounts that demonstrate how their money is currently invested, and many of those account statements we look at have money invested in Facebook stock.

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