When Can I Retire??

While  reviewing some  financial industry  publications  today I  came across  something somewhat  frightening. It was an article quoting a study done by a group called My New Financial Advisor (MNFA). The purpose of  the  study  was to look at Baby Boomers facing retirement and tried to  determine what  age they would  reach before they  are able  to Retire. First let me say that the study was relatively modest in  size but the  findings are still Disturbing and Frightening.  I might  say this is rather fitting on Halloween  night!!

The survey was conducted  by collecting  data on 1600 Baby Boomers. They concluded that many Boomers due to the following six factors; a Loss of Income,  Insufficent Savings,  Low Rates of Return on Their Retirement and Other Financial Assets,  Higher Than Expected Expenses,  High Taxes,  and A Low Rate of Growth In Personal Income will have to  postpone their retirement till their mid 70's. Is  that  frightening enough  for you?   I don't know about you but I don't want to HAVE TO Work until I  am in my mid 70's.  Now, I'm not saying working until age 70-76 is a bad thing!  In fact, for  many people  thats a good  thing.  I  am  saying that I would  hope that if you are still working until you are almost 80 years of age that it is because  YOU WANT TO,  NOT BECAUSE YOU HAVE TO!!

START TODAY!
Squeeze your  expense budget, use the money saved to  increase retirement  savings.  Look for  SAFE Money Financial alternatives that produce a reasonable rate of  return.  Guarantees of up to 6%  in the growth of Income Account Value, when used for Lifetime Income, are available today.  This can  be done without market risk today!  The "Without Market  Risk" is a big deal since  retirees or near  retirees cannot afford the market lossses most have seen in the past 10-12 years. Getting  Back to Even is not good  enough.  Where do you currently have your Safe Money?

I believe it was Warren Buffet who said  there are two rules in financial management.
Rule 1 Don't Lose Money!
Rule 2 NEVER FORGET RULE 1!

 If  you  don't believe  we have significant risk today. What  about  Europe?  What about our out of control Federal  deficit? Where are we going to  get the money to pay for it?  Expect increased Taxes! Ever hear  of  the  terms The Fiscal Cliff, or Double Dip Recession. What about  the increasing cost of everything you need to buy in the  Consumer Price Index (Inflation Risk)?

Polaris Financial Services
614-264-3864

Business Long Term Care,

Remember when Obama promised to offer national health insurance for all Americans. First he granted several hundred of the largest employers in the country exemption from the requirement. How does that possibly increase the quality of health insurance coverage for everyone when significant numbers of the largest employers do not even have to comply?
Then recently the Obama government administration fired the man assigned to run the Long Term Care (LTC) portion of ObamaCare. He basically fired the man responsible for the program with out any intention of naming a replacement. Obama hoped this dismantling of the LTC program would slip by unnoticed just like the employer exemptions granted on the general employer health plan side of ObamaCare.

In fact the LTC portion of the legislation was fatally flawed from its initial design. It was too expensive for each employee for the amount of coverage provided. It offered a nearly useless level of benefit of only $50 per day. It required that an employee pay premium for at least 5 years before you are even eligible to file a claim. An employee who started paying premiums for one year then went into a nursing home would have to pay premiums for four more years before filing a claim. These are just a couple of the most significant design flaws in the legislation.

Where does this program stand today?
Obama Killed it. He  fired to man he hired to  run it. He burried it  without  any form of media play or announcement.

What is an employer or an  employee to do now?
We can help you design a properly sized cost effective LTC Plan with a reasonable amount of benefit for your needs. If an employee has to go into a Long Term Care facility months after the policy is set up and premiums are paid they are eligible to file a claim and after the exclusion period the LTC benefits will be paid. If you want to learn more about the plans options for your busines please contact  us

 Polaris Financial Services
(614)-264-3864

Savings Needed For Retirement Rule Of Thumb

An article recently appeared in  the  Columbus Dispatch  and  the Ft. Lauderdale Sun Sentinel. The original article  was  written by Donna Gehrkee-White. The primary point of  the article  was  to  give savers a rule of  thumb to  help  determine how much money they need to  have saved prior to  retirement.  Whats nice  about  the approach is it doesnt assume  that everyone has  the  same  number. Of course everyones stlye of living and  retiring is differen, therefore their personal savinggs need is also going to  be  different. The  suggested  rule of  thumb is this.  You  should have 8 Years worth of income saved in order to plan on a comfortable retirement. In other  words if your last years income was 40,000  then 8 x 40,000  = $320,000 and if  your inccome was $150,000 then  you  should  have $1,200,000 in savings.  This  serves as a starting point. If a retiree has a large pension lifetime income stream  they may be able to  reduce the saving $ needed to  secure a safe  retirement. If  they dont they may  want  to  increase the amount they  save  before they retire. 

You  can  also work a  few extra  years to  increase  saving and  decrease  the  amount of  savings needed. Remember  this also increases their  Social Security income for life. We have  available a Social Security Calculator that  lets a client determine the optimum age to begin their Social Security Income benefit and if they are married helps to strategize how and when to begin taking SS income. This is just one of the services we offer to our retirement clients.  We also  help to increase their retirement income WITHOUT MARKET RISK.

Polaris Financial Services
614-264-3864

How safe are Moneymarket Funds?

The Washington Post recently published some interesting comments quoted from Mary Shapiro who just happens to be the Chairman of the Securities and Exchange Commission (SEC). Many people park funds in these Moneymarket accounts believing that they are both Safe and Liquid.
Just how Safe are they?
Remember What happened in 2008 when Primary Reserve Fund share prices fell below $1.00
you could Google it or search newspaper archives. Students of history suggest that History repeats itself

Mary was quoted as saying - investors "have been given a false sense of security"
"Funds remain vulnerable to the reality that a single moneymarket fund fund breaking the buck could trigger a broad and destabilizing run"
She went on to say that in a crunch investors may face limits on withdrawals

I am not telling anyone to buy or not to buy these products.
I just found the comments by Mary to be extremely interesting and maybe even a little bit unsettling!
What do you think??

There are financial products available that have no market risk. There are other financial products that include various amounts of market risk. Understand what you are buying! Everyone needs to understand the diference between what I like to call Safe Money and Risk Money. For most people there needs to be a combination of both! What is your comfort level between the two?

I believe it was Wil Rogers the intellectual cowboy who once said "I'm more concerned with the return of my money, than the return on my money"

Your Retirement Assets

In our last post we talked about the concept of Retirement assets with a different liquidity requirement or need date. I like my clients to think about pots of money or buckets. Some of the conceptual buckets are like a pile of cash in your wallet, others are like money in a checking or savings account. Still others are like money in a short term Bank CD or security. The final time bucket is for very long term needs like future house mortgage payments or college funding for your children or estate planning for caring for loved ones after your death.

As you would imagine different time of need money buckets require different financial products in order to optimize liquidity and earnings or growth potential for that particular asset pool of financial assets.

New 401 K PLan options

USA Today in an article written by Christine Dugas talked about a new proposal from the government which would add an option to include Annuities when they are ready to retire.

This really isn't news. I have been offering my 401K Plan clients the ability to do just this for several years. All of my plans include a client option to save during their working years and to handle either some of their retirement assets or all of their assets utilizing Fixed Indexed Annuity (FIA) Products when they actually do choose to retire.

All annuity products are not equal. Not all annuity products offer protection from market risk combined with lifetime income streams that a client cannot outlive. Only an independent licensed insurance professional can truly help you find the ideal Annuity Product or in many cases offer you the right combination of Annuity products that meet your strategic retirement goals. Independent agents can select the best product from multiple carriers that address different parts of your long term goals. We need money in retirement at different times and with different liquidity requirements. We will talk more about this later.