Wills, Trusts & Estates Prof Blog

Editor: Gerry W. Beyer
Texas Tech Univ. School of Law

Tuesday, August 26, 2014

Seven Cardinal Rules of Retirement Planning

Retirement planning

Financial planning for retirement has always been an overwhelming prospect; the existing economic landscape makes preparation that much more important in utilizing assets appropriately.  There are seven important points everyone should know when it comes to retirement planning:

  1. Don’t time the market. Markets move in cycles and investors are terrible at correctly predicting market movements.  Stay calm and focus on long-term strategy.
  2. Use risk-appropriate financial vehicles. While eliminating risk isn’t possible, you can manage it through competent retirement planning and an understanding of goals and financial circumstances.
  3. Invest tax efficiently.  Taxes can hurt investment returns, this is why it is important to structure your investments so that you are able to keep what you earn.
  4. Complete a cash flow analysis.  This will identify spending patterns and help ensure you have enough income to support your retirement lifestyle.
  5. Guarantee your required income.  Having income that is not subject to market fluctuations is an important part of a retirement plan.  A financial advisor can help you explore options for additional streams of income for life.
  6. Longevity planning. Longevity planning is about preparing for a comfortable retirement and helps ensure your wealth lasts as long as you need it to.
  7. Effects of inflation.  Inflation is a big issue because retirees can disproportionately be affected by rising prices.  Positioning your retirement portfolio to fight inflation is crucial to ensuring adequate income in retirement. 

See Carl Edwards, Retirement Planning: Seven Cardinal Rules, My San Antonio, Aug. 26, 2014.


Elder Law, Estate Planning - Generally, Non-Probate Assets | Permalink

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