The economy is improving, but our concern over money isn’t. Enter lifestyle planners, a new breed of financial advisors here to tackle money worries in retirement. —
They’re sorely needed, according to the American Psychological Association. The organization recently found that 72 percent of Americans feel stressed about money at least some of the time during the past month, and 22 percent said that they experienced extreme stress about money during the past month. For the majority of Americans (64 percent), money is a somewhat or very significant source of stress, the association reports.
“Regardless of the economic climate, money and finances have remained the top stressor since our survey began in 2007,” American Psychological Association CEO and Executive Vice President Norman Anderson said upon the study’s release. “Furthermore, this year’s survey shows that stress related to financial issues could have a significant impact on Americans’ health and well-being.”
That stress can be even more pronounced for those preparing for, or already in, retirement. The possibility of insufficient income due to poor savings and decreasing pensions, combined with concerns over another 2008-style economic event, can impact someone’s overall portfolio, as well as their confidence.
The pain isn’t only felt in the pocketbook; the actual physical toll financial stress can cause is real. It’s one reason more financial professionals are broadening themselves and their businesses into that of “lifestyle planners.” No longer simply about crunching the numbers to estimate needed income, this holistic approach is in keeping with baby boomers ongoing redefinition of the concept of retirement itself.
Happiness in retirement might be playing tennis or golf, volunteering at a local church, traveling and yes, something as simple as maintaining good health. Each requires a solid financial plan, but in an encouraging flip from traditional planning, what retirees value and how to make it happen are increasingly looked at first; finances to get them there second. Incremental steps in financial confidence therefore build on themselves, fostering a healthy and active lifestyle that includes exercise and activities to reinforce their well-being.
Here’s an example of how a lifestyle planner works:
“There was a retired firefighter with a good pension, but his wife never built up enough qualifying years for Social Security benefits because she stayed home raising eight children,” Ryan Eaglin, president of Eaglin Financial Services in Phoenix, Arizona, explains. “One or two children were still living at home as he was about to retire due to personal issues. They wanted to do things; spend time on their houseboat on Lake Powell, go camping with their adult children, etc.”
After reviewing their situation and available resources, it was determined that the $80,000 annual salary the firefighter was making would drop to $60,000 of annual income in retirement. The goal was to get the firefighter and his wife back to the same level of income they enjoyed before he retired, which they were able to do buy combining his pension with existing savings and a suitable fixed-index annuity.
“They ended up with $90,000 a year,” Eaglin says. “They are currently spending three months a year on their houseboat, and another three months each year traveling and away from their primary home.”
While the firefighter’s retirement needs were successfully met, it isn’t always the case. Procrastination is a retiree’s [or pre-retiree’s] worst enemy, and individuals and couples too often wait until they are already in retirement before seeking professional advice. While a financial professional can still help, it can become increasingly difficult, and there is a greater possibility of needing to make changes to a retiree’s overall lifestyle. Nonetheless, lifestyle planner are here, and waiting, to help.
Eaglin Financial Services is an independent insurance firm helping individuals create retirement income strategies using products, such as annuities, to custom suit their needs and objectives. We do not provide any tax, legal or investment advice.
Annuities are long term products designed to supplement retirement income. Their guarantees are backed by the financial strength of the issuing carrier. Note that they may be subject to surrender charges and holding periods. Review any contracts carefully prior to a purchasing decision.
Source URL: http://councilofeliteadvisors.com/liftmedia
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