If it seems like most of your days of late have been spent imagining all of the amazing adventures and wonderful experiences you’re going to enjoy after retirement, you need to start your financial planning now.
If you’re close to retirement, you probably already have an advisor managing your investments. But as the day draws ever near, you may have started to wonder if your current advisor understands the ins and outs of the lifestyle you see yourself enjoying after you retire.
You want to know that your advisor has taken into account all of the changes you might make in your life—traveling the world, remodeling the family home, moving into an active seniors community or, eventually, finding an assisted care service.
Whatever your personal vision of retirement, our guide helps Cincinnati seniors plan for the future you see yourself living.
Financial Tips Cincinnati Seniors Can Put to Use after Retirement
For seniors across the US, the ultimate question when it comes to managing your money is “who has your back.”
While you put a lot of trust into your advisor when you hand over the reins to your investment portfolio, you may be surprised to learn that financial advisors are rarely bound to a particular set of governing rules for how they manage your money. That is, they can advise you to invest in potentially risky stocks (without your awareness of the risk) and net a commission based off of how well your investment does. This tends to work more in their favor than yours in many cases.
But you can rest easy in future of your finances by taking the steps now that will help protect your assets (and peace of mind!) later.
1. Work with a registered investment advisor.
These advisors, also known as "fiduciaries," are regulated by the federal government and both legally and professionally obligated to act in a way that protects your best interests, not theirs. Fiduciaries work on a fee-for-service schedule which means that they receive a percentage of your profits in return for manage your assets.
2. Discuss fee structure with your advisor to see if you're breaking even or losing out.
If you aren’t working with a register fiduciary, you may want to be a little more involved in selecting your investments. Ask your advisor why they are recommending particular stocks, what fees will be incurred to you and what commissions they stand to gain.
If you’re paying a management fee it may be eating up assets.
3. Consider whether you need a personal financial advisor.
Some seniors may want to seek out an additional advisor who can help them get a handle on the full scope of their finances—especially older adults who have considerable assets outside of their investments.
Not everyone needs a personal advisor, mind you. If most of the assets you intend to live on after retirement are in an online brokerage, you may be set. These types of investments fairly simple to manage—you essentially rely on the Dow Jones index, earning or losing as it does—and are not associated with hidden fees or high fees.
4. Consult a retired advisor or accountant
Many retired advisors and accountants who are still interested in the happenings in their old field will offer free advice to those lucky enough to know them. Maybe you're trying to decide if you should cut your current financial advisor loose to switch to index funds online. Depending on the type of assets you have to manage after retirement, an unbiased outlook could save you a lot of time and money down the road.
5. Thinking ahead.
If you haven't already named a power of attorney or have a clearly outlined health care proxy, protect your assets by taking time to get this documentation in place. Ask yourself, "who would think like I would think?"
A power of attorney is your advocate in many circumstances, but is primarily involved in assisting you to or fully manage your assets. Developing a clear plan of allocations will help protect your assets from dwindling into your golden years.