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7 Cardinal Rules

Retirement planning is the process of clarifying your personal and financial goals in retirement, identifying sources of income, and developing strategies to ensure that your income can support your lifestyle. Today’s retirees face challenging market conditions and many risks to a comfortable retirement. While no strategy can guarantee the achievement of your goals, we have developed a list of rules that we believe give our clients the best opportunities for success while protecting against risk.

  1. Avoid Trying to Time the Market
    Markets often move in cycles and some investors believe that they can boost their investment returns by buying at the bottom and selling at the top. The problem is that investors are terrible at correctly predicting market movements and multiple studies have shown that market timers usually end up with significantly smaller retirement savings than buy and hold investors. While it can be stressful to see your portfolio plummet during a market correction, it’s important to stay calm and focus on your long-term strategy.
  2. Use Risk Appropriate Financial Vehicles
    Retiring can be a risky business. The days of relying on employer-provided pension plans are largely over and retirees now have to deal with risks like investment risk, inflation risk, healthcare risk, longevity risk, and others. Though the total elimination of risk isn’t possible, we can manage many of these risks through competent retirement planning and a clear understanding of factors like your goals, time horizon, and financial circumstances.
  3. Invest in the Most Tax Efficient Manner
    Taxes can take a big bite out of investment returns, which is why we stress tax-efficient planning with our clients. While taxes are just one piece of the overall financial puzzle, it’s important to structure your investments so that you are able to keep what you earn.
  4. Complete a Cash Flow Analysis
    Retirement will involve major changes to your finances. Sources and timing of income will change and financial priorities may shift as you start generating income from retirement savings. A cash flow analysis will identify spending patterns and help ensure that you have enough income to support your retirement lifestyle.
  5. Guarantee Your Required Income
    For many retirees, having income that is not subject to market fluctuations is an important part of their retirement plan. Many will have at least some level of guaranteed income from Social Security or defined benefit pension plans. However, if you are worried that your expenses exceed your guaranteed income, a financial advisor can help you explore options for additional streams of income for life.
  6. Utilize Longevity Planning
    Today’s retirees are living longer than ever and many worry about outliving their assets. Longevity planning is about preparing for a happy, comfortable, and independent retirement and can help ensure that your wealth lasts as long as you need it to.
  7. Consider the Effects of Inflation
    Inflation is one of the biggest issues facing retirees because they are disproportionately affected by rising prices. Escalating food, fuel, and medical costs can devastate a retirement portfolio unless these costs have been factored into your planning. Positioning your retirement portfolio to fight inflation is critical to ensuring adequate income in retirement.

We hope that you’ve found this information informative and reassuring. If you have any questions about retirement planning or would like to discuss your personal financial situation, please contact us for a free consultation.

Disclosures

C.E. Wealth Group, LLC, Calton & Associates, Inc., and its Registered Representatives does not offer tax or legal advice. Individuals should consult their tax or legal advisors before making tax or legal-related investment decisions.

Securities are offered through Calton & Associates, Inc. Member FINRA/SIPC, 14497 North Dale Mabry Highway, Suite 215, Tampa, FL 33618 (813) 264-0440.

Advisory Services are offered through OnPointe Advisory and Financial Services, LLC, 2090 Marina Avenue, Petaluma, CA 94954 (800) 395-0045.

Insurance or insurance related products are offered through C.E. Insurances, LLC.

C.E. Wealth Group, LLC, OnPointe Advisory and Financial Services, LLC, and Calton & Associates, Inc. are separate entities.

The ChFC® and Chartered Financial Consultant ® marks are the property of The American College, which reserves sole rights to their use, and are used by permission. 

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. Diversification does not guarantee profit nor is it guaranteed to protect assets. Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance. 

Consult your financial professional before making any investment decision. 

Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors. 

All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.