Being retired is about financial independence, not aging or even giving up working. There were probably times that you wanted to do something but couldn’t because you didn’t have time. You were too busy working to earn income.
In this phase, your hard work and diligent saving have paid off, you now have both time and the money to focus on what matters most to you. This doesn’t mean you can relax without a care in the world. There are plenty of uncertainties ahead. Here are important issues to address:
An investment policy will be developed for you based on your planned spending. Then portfolio withdrawals are monitored to verify the allocation is properly maintained and distributions are not excessive. The investment goal while you are living the dream is to grow your income so you can keep pace with inflation. Rodgers & Associates helps you keep up by using the 4% rule for prudent withdrawals as a guide. An industry study¹ found that an investment portfolio with the proper asset allocation may be able to sustain annual withdrawals of 4% and keep pace with inflation. Our regular portfolio review for each client can provide confidence that their investment strategy is working and stays on track to reach their goals.
We educate our clients about healthcare coverage options and choosing the right coverage can be complicated. Many seniors rely on Medicare to provide their health insurance coverage. We educate our clients about a range of healthcare coverage options because Medicare does not cover everything. There may be reasons a client should choose a Medicare Advantage plan over traditional Medicare. We help our clients work through the pros and cons so that they can make a choice for their unique situation.
Maximize your Social Security benefits
When should you draw Social Security benefits? Should your spouse draw first? These are questions we help clients answer to get the most from this important government program. The Social Security website contains more than 2,700 separate rules governing when benefits can be claimed and how. It is important our clients get this right the first time. We feel a financial strategy should consider other income sources, taxes and potential health issues to determine the optimum time for each client to sign up for benefits.
Finding purpose in retirement
Human beings are social by nature. We thrive on interaction with each other which may have been found daily through work. You will want to find ways to stay engaged with family, friends, and your community. Transitioning out of a lifestyle with deadlines can create a different kind of stress. You should still have goals and keep track of things you want to accomplish.
Implement a tax-efficient strategy for your portfolio
Did you know that Social Security can be taxable based on your income? Or that Medicare premiums are determined by your Modified Adjusted Gross Income? Our tax-efficient approach to retirement planning, the New Three-Legged Stool™ strategy, is designed to minimize taxes and Medicare premiums. Part of each quarterly review is devoted to minimizing taxes by analyzing the best place to draw income for each client’s situation. A 2019 study² evaluated the impact of tax-efficient distributions on the sustainability of withdrawals and found the most tax-efficient sequence could extend the portfolio seven and a half years longer than the least tax-efficient sequence!
Live your best retired life.
10 years before retirement
Develop a comprehensive plan to help ensure you will reach financial independence tax efficiently.
Learn about phase 1 →
2–9 years before retirement
Reach a solid financial position through a disciplined approach to managing changes in the years leading up to retirement.
Learn about phase 2 →
1 year before and into retirement
Transition to financial independence and fine-tune your plan to prepare for post-retirement taxes and healthcare.
Learn about phase 3 →
Stay focused on decisions related to taxes, Social Security, and investments to help ensure your savings last.
You are here
Take an active role in teaching the next generation how to handle wealth and the responsibility that comes with it.
Learn about phase 5 →