How to Map Out Your Financial Success

I’d like to share some ideas with you of how to maybe map out your financial success. So retirement planning is a journey. And maybe you’re a bit nervous about what that looks like and unsure about your future. And another idea is maybe you don’t feel educated enough. It can be complicated. So here’s my little plug, you can go to cen-wealth.com and we have a vlog that has a lot of different videos, you know typically three minute videos where hey, I want to learn more about Roth IRAs. What are they? You can type that in and get a quick education about what that is and how it may be valuable to you. So that’s my plug for the day. But here’s a few reasons that you’ll want to start planning early. So you want to ideally maintain your standard of living. You want to prepare for unforeseen medical expenses. Those can come up and surprise you and be quite costly. You want to support your family. You want to safeguard your financial independence. You want to get tax benefits and better returns on your savings and enjoy your retirement. And maybe provide that peace of mind. The good news is that people are living longer, but that adds an extra complexity when it comes to your retirement plan. So you want to ask yourself, have you saved enough to retire early? And how long do you need to continue working? Or do you want to continue working? A lot of times we’ll have conversations where okay, we’ve mapped things out. And something at Centennial Wealth we like to do is sort of put all of this data together to sort of see, okay what does retirement look like for you the next 20-30 years etc and do our best to try and put together some projections. And a lot of times you might come across where oh okay, I could retire now. But I’m really enjoying what I’m doing and I want to stay working for a couple, three more years let’s say. So take that into consideration. And I’d say too many people today are solely counting on Social Security as their primary source of retirement income. And it’s really only intended to replace a portion of your previous earnings or salary. And on average it replaces around 40% of your previous income. But for a lot of retirees, it may represent 90% of their income. So you want to ideally be building up your savings. And is it your goal to just ultimately sort of get by or do you want to thrive in retirement? And if that’s the case, then planning is going to be key. That question as I mentioned before sort of when do you want to retire? Is it something that you want to retire early? You know maybe you’ve set a goal of I want to retire in my 50s or whatever age that might be. That’s going to come with some different retirement withdrawal limitations. You also won’t have access yet to Social Security. You’re going to likely then have to go shop around on the marketplace for health insurance and what are the costs going to look like for that? So you want to be factoring all of that in. Where do you want to live? Maybe it’s time that you considered downsizing. The family is out of the house and everything. So now it’s time to downsize. Are you looking to stay in the area or are you going to try and find a lower cost of living as we’ve seen with northern Michigan and the costs increasing significantly. How are you going to pay for your lifestyle? You know, Social Security, Pension, Annuity, whatever known income sources and then using that retirement savings to help supplement. And how much do you need to save? What is that figure that you have to have saved in order to generate enough income to help you to and through retirement. And saving money versus investing, there’s differences there. You can save money probably not going to in a savings account not get a whole lot of return. But it’s not going to be taking this risk. So that’s where investing it, a little bit higher risk, a little bit greater potential for return. And how much should you save? You know ideally, maybe 15% or maybe more should be tucked aside for retirement. But maybe you’re not at a place yet to do that. So maybe that’s starting with 6% of your income. So that’s something to consider. But all and all, there’s a lot that goes into creating financial success and getting to retirement. And that’s where here at Centennial Wealth Advisory we’ll look at all of these different areas to help you ultimately get to retirement, but then have a successful time throughout your retirement years as our objective here is to help you plan to retire well.