Retirement planning is something everyone needs, but, like that annual check-up with your doctor, is often put off until something hurts. It’s not surprising that we procrastinate it: Retirement planning can be daunting. There are so many questions around retirement and so few places to get reliable, personalized answers. But the very reasons that make retirement planning daunting are also the reasons it’s so essential to start early.
The objective of retirement planning is to prevent things from hurting your retirement dreams. The sooner you start planning for retirement, the more likely those aches and pains can be addressed. Whether you’re just starting out in your career or are about to retire, it’s important to be educated about retirement planning and how to build a personalized retirement plan that will help you pursue the retirement you dream of.
Here we cover what you need to know about retirement planning in Baton Rouge so you can plan today to address financial aches and pains tomorrow.
Why Retirement Planning is Different From Financial Planning
Retirement planning and financial planning often go hand-in-hand, but the two are not the same. Financial planning is about building a plan in seeking to get you from where you are today to where you want to go. Your destination can be retirement, but it could also be saving for your child’s education or getting out of debt. Financial planning focuses on building a plan for you and your family today, whereas retirement planning is more about planning your future retirement.
Retirement planning is a more focused part of financial planning. While a financial plan looks at all of your financial goals, a retirement plan focuses strictly on preparing you for retirement. As such, retirement planning can go into more granular detail about this key aspect of your life journey.
A retirement plan will address things such as:
- How to begin taking income from your investments
- How to handle your Required Minimum Distributions (RMDs) and pre-59-½ withdrawals
- When to begin taking Social Security benefits
- Pension timing and election options
- How to manage taxes in retirement
- How to cover healthcare costs in retirement
- Longevity and long-term care strategies
Personalized Retirement Planning
Everyone’s dream retirement is different. How you want to spend your Golden Years may be vastly different from the ideal retirement your friend or colleague dreams about. Since no two retirements are alike, no two retirement plans should be, either.
With personalized retirement planning, you can create a retirement plan tailored to you and your individual needs and dreams. A personalized plan evaluates your individual situation.
It can answer key questions you may have about your retirement, such as:
- Am I saving enough to retire when I want to?
- Am I investing the way I should be to retire?
- How should my investments change as I near retirement?
- What should I do with my 401(k) when I retire?
- When should I begin taking Social Security?
- How much will I have available to spend in retirement?
- Will I outlive my savings?
Will You Outlive Your Retirement Money?
A big question retirees face is: Will I outlive my retirement money? The way to help prevent running out of money in retirement is to be proactive in planning for retirement.
A good retirement plan will show you how long your current savings will last in retirement and what to do if the answer is that they won’t last long enough.
You can attempt to answer these questions online with retirement tools and calculators, but these are often not advanced enough to provide a reliable answer. And a simple online retirement calculator can’t show you the steps to take if you haven’t saved enough. But a robust and holistic retirement plan can.
If running out of money in retirement is a concern, a financial advisor in Baton Rouge can help you create your personalized retirement plan so you can be confident knowing your future is planned for.
Why You Should Hire a Retirement Planner
A retirement planner is a financial professional who specializes in helping you plan for retirement. Retirement planners understand all of the ins-and-outs of retirement. They can help you address the biggest challenges every saver faces, such as estimating how much your retirement will cost and how to save and invest for retirement. And the retirement challenges don’t stop there.
Once you reach retirement, planning can become even more complex. Retirees are faced with the daunting task of seeking to turn their hard-earned savings into an income stream that can provide for the costs of daily living – costs that only rise as retirement progresses.
A retirement planner will be there for you as you near, enter, and progress through retirement. He or she will help you address your financial concerns so you can focus on enjoying being retired. After all, you’ve earned it.
What Services Does a Retirement Planner Provide?
A retirement planner helps you build and implement a comprehensive plan to guide you into and through retirement. Their job is to put in all the leg work today to help you pursue an independent and happy future after you stop working.
Your retirement planning meeting will often begin by establishing what’s most important to you both today and later on. From there, the planner will evaluate your current financial situation and establish how to get you from where you are today to where you want to be when you retire.
A retirement planner will assess:
- Your current savings and investments
- Your risk tolerance
- Your sources of retirement income
- Your desired lifestyle in retirement
- If you’re on track to meet your retirement goals
- Your planner will help you address any challenges you face as you plan for, near and enter retirement. He or she will model the various options you have to help you seek to minimize taxes and maximize your lifestyle in retirement.
How are Retirement Planners Compensated?
Financial advisors can be compensated in one of two ways: Through commissions earned on the investments you buy or through fees you pay directly to the advisor.
Most retirement planners charge either a flat hourly fee or a fee based on the assets you have with them. For instance, they may charge 2 percent of your portfolio value each year.
Compensation is an important consideration when choosing a retirement planner, but it isn’t the only thing to think about.
How to Find the Right CFP to Help You Plan For Retirement in Baton Rouge
When choosing a retirement planner in Baton Rouge, look for one who is a Certified Financial Planner (CFP). CFPs are held to high ethical standards. They’re also required to take extensive courses on financial planning.
Doing the proper research to find the right retirement planner may take a little time, but finding the right person the first time will save you a lot of time in the long run. This decision shouldn’t be taken lightly. The right retirement planner can determine when and how you can retire and whether you are able to leave anything behind when you’re gone.
Retirement Planning for Petrochemical Employees in Baton Rouge
When looking for a retirement planner, it’s always helpful to find someone who specializes in your industry. A retirement planner who focuses on petrochemical employees, for instance, will understand the unique challenges and lifestyles of such workers.
A retirement planner familiar with the petrochemical industry in Baton Rouge is also more likely to have detailed knowledge of the workplace, retirement plans and benefits available to you.
The same way you want a retirement plan tailored to your individual needs and situation, you should find a retirement planner whose expertise is tailored to your industry and location.