Smart Retirement Planning For Every Age

Solid planning and the right safety net will ensure that you enjoy your golden years

www.united seniorshealth.org and www.ahca.org to learn more.

ESTABLISH A CONTINGENCY PLAN
Only one in five retirees or pre-retirees has a written plan for managing income, expenses, and assets during retirement, says Roman. The Gipsons, for example, don’t have an emergency fund with three to six months of living expenses, which, regardless of age, everyone should have. Since many retirees live on a fixed income, it’s also important to create a budget to help d
ecrease discretionary spending. Any resulting savings should go into a diversified investment account, says Roman. Those dependent on one income should also think about what life would be like if a spouse were to die. If you or your spouse will receive it, factor in your annual Social Security benefit statement to determine the amount of any future retirement benefit. For budget and savings tips, go to the American Institute of Certified Public Accountants site, www.360financialliteracy.org.

DEVELOP AN ESTATE PLAN
As you reach your twilight years, meeting with a qualified attorney to develop an estate plan is a priority. First on the list is updating your wills to ensure they reflect your current wishes.

Second, durable powers of attorney and healthcare proxies should be prepared to provide instructions for how you want your affairs and healthcare treatment handled in the event of your physical or mental incapacity.

Third, determine your interest in legacy planning for your children and future generations. A site that may be useful in sorting out estate planning issues is www.nafep.com, sponsored by the National Association of Financial and Estate Planning.

The Advice For Your 60s
As you approach and perhaps enter retirement, you will need to change your asset allocation to reduce your portfolio’s volatility and overall market exposure, says Roman.

Keep in mind that asset allocations will vary based on how much retirement savings you’ve accumulated and your specific life circumstances. There is no one model that is right for everyone. If you’re in your early 60s, you might choose to stay somewhat aggressive with a 40% stocks, 60% fixed income mix. But, for many people, depending on their circumstances and risk tolerance, 20% stocks and 80% fixed income may be more suitable.

Typically at this age you’ll want to have a more balanced portfolio overall. A possible mix might include: 20% investment-grade treasuries, 20% corporate high dividend bonds, and 10% corporate high-yield bonds, plus 10% large-cap growth, 12% large-cap value, 3% mid-cap growth, 5% mid-cap value, 3% small-cap growth, 5% small-cap value, 2% micro-cap, 3% international growth, 3% international value, and 4% real estate stocks.

70s
Vernettia Pree was 63 with no intention of retiring anytime soon. As fate would have it, the decision would be made for her. Pree was forced to leave her nursing position at Kaiser Permanente Medical Center after she nearly died from a workplace injury in 1995. She is healthy now and, at 73, the divorced mother of five continues to learn how to deal with the unexpected.

Pree was unprepared to retire—financially and emotionally. “I had to learn to do with less abruptly,” says Pree, who lives

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