7 Retirement Strategies to Retire Successfully

Key Points – 7 Retirement Strategies to Retire Successfully

There’s More to Retirement Than Your Investments
Things That Can Be Overlooked When DIY Retirement Planning
What Do You Want Your Retirement to Look Like?
Considering Taxes, Social Security, Insurance, Your Heirs, and Much More
8 Minutes to Read | 24 Minutes to Watch

Gaining More Confidence, Freedom, and Time in Retirement

A successful retirement is something that everyone strives for, but it isn’t something that you can simply speak into existence. Achieving a successful retirement requires thorough planning before and after you retire. Hopefully, this list of retirement strategies that we’ve composed can help you get to and through retirement with more confidence that you’re doing the right things with your money, freedom from financial stress, and time to spend doing the things you love.

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Retirement Strategy #1: Get a Trusted Team of Financial Professionals

We have a few questions for you as we kick off our list of retirement strategies.

Do you trust your primary care physician?
What about your dentist?
How’s your relationship with your mechanic?

Hopefully, your answers were all positive. The point is that it’s important to have trusted professionals in many categories to deliver services that can’t be done on your own.

You might be thinking, “But I can invest for retirement on my own.” While we have no doubts about that, retiring isn’t just about your investments. There are other implications outside of investments and savings when it comes to strategies for retirement.

We’re going to cover some of those implications in this article and many more of them in our Retirement Plan Checklist. It’s comprised of 30 yes-or-no questions that gauge your ability to comfortably get to and through retirement and an age-based timeline of key retirement planning considerations. Download your copy below.

Retirement Plan Checklist

You’re the Owner of Your Team

Think of retirement in terms of a football team, and you’re the owner. As the owner, you don’t personally coach the team, draft the players, or even play on game day. Instead, you have a head coach, a general manager, offensive and defensive coordinators, players, and many more who support your goal of winning the championship, or in this case, retiring successfully.

In this case, as the owner, you surround yourself with trusted professionals along the way. Having a CFP® Professional as the head coach of your retirement can help coordinate your finances between other professionals like CPAs, CFAs, and estate planning and insurance specialists. As you prepare to retire, you need to make many difficult decisions. With a trustworthy team of financial professionals by your side, you can navigate these choices more adeptly.

Over the past decade, one white paper that Dean Barber and Bud Kasper have referenced several times on America’s Wealth Management Show is Morningstar’s white paper, Alpha, Beta, and Now…Gamma, having a financial planner who practices specific financial planning techniques can produce up to 22.6% more income in retirement per year. That’s regardless of the underlying investments.

These retirement strategies and financial planning techniques bring together multiple facets of retirement. If that’s not an eye-opening statistic on why you need a financial planner, we’re not sure what is.

Retirement Strategy #2: Make Goals for Retirement

This seems simple enough, right? Think about what you want to do in retirement. Do you want to travel? What about spending more time with the family? Maybe you’ll want to downsize your home or move to an entirely new city. Whatever you choose to do in retirement, make sure you relay it to your financial planner. If they don’t know what you want to do with your retirement savings in the first place, how can they make a successful retirement plan for you?

It’s not just the big things you’ll need to think about either. While buying or selling a home is something you want to discuss with your financial planner, you should also talk about smaller things. Things like how often you and your partner will need new vehicles. When will you need to replace the roof again? Are you planning to pay for any child’s or grandchild’s educational expenses?

Discuss these things with your financial planner so your plan can address your specific needs. After all, it is supposed to be your retirement plan, not just a cookie-cutter ideal of retirement. If your financial planner doesn’t know your goals for retirement, your plan’s strategies may not be the right fit.

Retirement Strategy #3: Build a Multi-Year Tax Planning Strategy

Often overlooked in retirement, tax reduction strategies that consider taxes over multiple years are among the most valuable retirement income strategies on this list. Our CPAs have the added benefit of understanding your goals for retirement alongside financial planners. This enables them to create a multi-year tax strategy that can reduce your overall tax burden.

No one likes overpaying taxes, but many don’t even know it when they are—especially considering the misconception that you’ll be in a lower tax bracket in retirement. This just isn’t the case in all situations. It just makes sense to have a tax plan aligned with your goals for retirement.

Tax planning considers other factors, such as Required Minimum Distributions, Social Security, and charitable donations. And not to mention new implications for beneficiaries of IRAs under the SECURE Act and SECURE 2.0.

Simply put, while you might be able to maintain your investment plan, navigating the tax code in retirement is a whole different can of worms. Having a financial planner and CPA working together to build a retirement strategy can help you pay less taxes and achieve your goals for retirement.

Retirement Strategy #4: Have a Plan for Claiming Social Security

Social Security is your money. After years of working and paying into the system, it’s your turn to claim what’s rightfully yours. So, you just go to the Social Security Administration (SSA) and start claiming your money, and the SSA employees will guide you through the best way for you to get the most out of your benefits, right?

Maximizing Your Benefits

Not so fast. While you’re first eligible to claim your benefits at 62, it’s critical to play the long game when claiming Social Security. We want you to understand that the longer you delay claiming your benefits, the larger they’ll be.

It’s also important to remember that your decision of when to claim Social Security isn’t just about you if you’re married. You need to consider your spouse as well. Understand that when the first spouse dies, the surviving spouse will only get to keep the larger of the couple’s two benefits.

That’s a big reason why it’s important to make sure that your benefits are as large as possible. There are some instances where it is necessary to claim Social Security when first eligible, but just keep in mind that you won’t be receiving as big of a benefit. The longer you wait until age 70 to claim, the bigger the benefit will be.

Retirement Strategy #5: Don’t Forget About Insurance

Risk management, or insurance, is one of the four pillars of retirement alongside taxes, estate planning, and investments. Insurance is a vital part of a retirement plan, and there are many factors to consider.

Property and Casualty

You need to make sure you aren’t underinsured or over-insured from a property and casualty perspective. No one wants to pay for unnecessary policies. Likewise, no one wants to be caught without enough insurance when they need it. Understanding the proper balance in your situation is a valuable retirement strategy.

Health Care & Medicare

The reality is that everyone will need health care at some point. And when we age, our bodies diminish and we in-turn use more health care than previously. Prescriptions are more prevalent as we age as well, and medications aren’t free. Making sure you have the necessary coverage for your needs is paramount to a successful retirement.

Other considerations include long-term care and life insurance. Our financial planners work directly with Medicare and insurance experts to make sure you’re properly covered. It’s just another one of the strategies we use for building a proper retirement plan.

Retirement Strategy #6: Keep Your Estate Plan Current

Family is essential to most of us. Developing a plan for your estate is something you do more for your loved ones than for yourself. So, when you think about how much life can change in a short amount of time, it’s important to keep your estate plan updated. You should review your plan every few years at the least to make sure you and your family have what they need in the event you pass on.

We’ve all been there when a family member passes away. Some of you may have dealt with nightmarish legal and financial issues in the wake of a death in the family as well. Instead of focusing on what truly matters, grieving and memorializing, your attention is directed to the minutiae of the estate. Keeping your estate updated is a gift that will keep on giving in your absence.

Building Generational Wealth

Is leaving a legacy something that’s important to you? If it seems like it keeps getting harder and harder to do that, that’s because it is. Let’s revisit the SECURE Act and SECURE 2.0 that we alluded to earlier.

The SECURE Act was snuck into legislation in late 2019 under the noses of most Americans. It pushed RMD age from 70½ to 72, and SECURE 2.0, which passed in December 2022, increased it to 73 as of January 2023. And that wasn’t the only RMD-related provision in SECURE 2.0. RMD age will increase to 75 by 2033.

Those provisions might make Americans feel more secure, but there were some sneaky provisions in the SECURE Act that limited the powerful tools used in estate planning. The Stretch IRA is now limited to a 10-year spend down. That means unless you leave your legacy to a specific type of eligible beneficiary, most beneficiaries will have to withdraw the entire inheritance within 10 years.

The problem that arises here is now your beneficiaries may have an incredible new and unavoidable tax burden from these withdrawals. Fortunately, there are ways of mitigating this with proper estate, tax, and insurance planning.

Retirement strategies need to be fluid to move around changes like the SECURE Act and SECURE 2.0. You need to adjust your plan to law changes like this so you know that your plan’s strategies are still effective for retirement.

Retirement Strategy #7: Have a Plan for Retirement

It seems like a cop-out, but at the end of the day, many people don’t have a plan at all. According to Schwab’s 2023 Modern Wealth survey, only 35% of Americans have built a financial plan that documents their needs, wants, and wishes.

That means that the other 65% aren’t considering the critical retirement strategies that we’ve discussed. If you feel uneasy about your plans to retire, find a trusted financial planner who works alongside other industry professionals. Together, they can provide you with a well-rounded plan for retirement that utilizes these strategies to help you achieve the retirement you desire.

If you have any questions about these retirement planning strategies and how they pertain specifically to you, start a conversation with our team below.

Schedule a Meeting

There is a lot to consider with retirement strategies just within these seven strategies alone. That’s why we encourage people to start working with a team of financial planning professionals sooner rather than later. We hope that these retirement planning strategies to help get you on your way to having a successful retirement.

7 Retirement Strategies to Retire Successfully | Watch Guide

00:00 – Introduction
01:03 – 1. Get a Trusted Team of Financial Professionals
03:51 – 2. Make Goals for Retirement
06:21 – 3. Build a Multi-Year Tax Planning Strategy
10:00 – 4. Have a Plan for Claiming Social Security
12:39 – 5. Don’t Forget About Insurance
15:58 – 6. Keep Your Estate Plan Current
18:37 – 7. Have a PLAN for Retirement
21:42 – What We Learned Today

Investment advisory services offered through Modern Wealth Management, LLC, an SEC Registered Investment Adviser.

The views expressed represent the opinion of Modern Wealth Management an SEC Registered Investment Adviser. Information provided is for illustrative purposes only and does not constitute investment, tax, or legal advice. Modern Wealth Management does not accept any liability for the use of the information discussed. Consult with a qualified financial, legal, or tax professional prior to taking any action.