Whether in retirement or still working the need for secure income is vital. For those retiring, after working for the past 30-40 years transitioning into retirement creates the need to be able to effectively use the tools and resources available to recreate their “paycheck”. Specifically, they need to overcome the Income Gap. The Income Gap is the ever-growing difference between the amount of money they will receive from sources like Social Security and pensions, which are fixed/secure, to what they will actually need in retirement. Because most people do not have a pension and social security will typically cover <50% of the income gap the need for income planning is paramount.

The same is true for those who are still 20-30 years from retirement who are entering into their wealth accumulation phase and cannot afford an extended lapse in savings habits. Outside of getting injured on the job and qualifying for workman’s compensation disability insurance is one of the only tools available to reproduce a paycheck. Statistically, a person is more likely to incur some sort of extended work absence during this time of their career than any other. If there is not planning in place to address this future retirement planning becomes extremely difficult.

With only two guarantees in life, death and taxes, it is important that we address the one we seemingly have the most control over. Unfortunately, you cannot get away from either one, but through forward planning and healthy decisions, financial or physical, we can make sure that we are in the best possible position. Every year millions of people leave money on the table for Uncle Sam and unless you catch it he is not going to send it back. Little known strategies and planning for the future through the lens of taxes can create big returns for the future as well as a better life today.

Most people have heard this called estate planning, but because this planning is for the future and to “advance” your wishes as well as future generations this is actually advanced planning. This type of planning involves more than just getting a will or a trust, it is about developing a plan for you and your family’s future should something unexpected happen or our 1st guarantee in life come true. Aside from taxes advanced planning is where more wealth is eroded due to lack of, or poor planning. Simply having a will or trust isn’t enough, you need to know what specifically is going to address you and your family’s unique needs.

While the risk to our investments is important even more so is the risk to our health and the risk that comes along without planning for our needs. Whether you are still working, retiring prior to age 65, or looking into Medicare it is important to know your options. It is easy to simply pick a plan because it is convenient or cheaper, but does that mean it is actually right for you? What will actually be covered if you get sick? How much will it cost you? The reality is that most American’s will spend upwards of $300K in medical expenses, so it is important that we are maximizing what will be an unavoidable cost for most of us. Aside from general healthcare costs approximately 70% of us will also have to contend with some form of long-term care event, which can be even more devastating in the absence of planning.

Assuming the top four key areas of Secure Income, Tax Efficiency, Advanced Planning, and Risk Management have been addressed this is the easy part. Those first four areas are the foundation of the how, what, when, and where of building a successful investment portfolio. Much like the old adage of “if you stand for nothing, you will fall for anything”, so too will your investments if there is no foundation to be built upon.

Saving is important early on, but if something happens and you lose your income, or you are not paying attention to taxes, or a major health event arises all your “savvy” and aggressive investment solutions are all for not if you haven’t considered any other area of your financial life. In retirement, there is no “do over” and once that transition is put into motion there is little want or opportunity to go back. Without building a retirement portfolio that takes into considerations the realities of retirement you are literally risking everything you have built.