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Five Important Steps to Planning a Secure Retirement

my grandparents sold their home in business for a couple million dollars they were very simple people didn't have a ton of savings before this but within five weeks of retirement my grandfather had two aortic aneurysms the next few years went to health care costs long-term care costs a downturn in economic conditions caused some of the high interest rate paying vehicles that they were relying on to drop the interest rates so their income was more than cut in half this experience led me to become a retirement planner someone focused on financial advising but with the specialty in the retirement Arena I've sat with thousands and thousands of families over the course of my career and that experience combined with what happened to my grandparents led to the creation of what we call the retirement success plan here at Oak Harvest Financial Group foreign success plan or RSP as we call it is a structured process that results in a final retirement plan that's customized to your particular retirement needs and concerns it covers five key areas which we're going to get into in today's video of what's important to be successful in our opinion when it comes to retirement planning it's built by a team of advisors that you have at your disposal and works in conjunction with the investment strategy by your in-house investment team here at Oak Harvest Financial Group what this means for you is that you have checked off the important boxes that we've learned over our years of experience are most critical to retirement success and it's also a timeline for execution and a way to monitor progress so we can make adjustments in real time to make sure you're staying on track for your retirement one of the big Concepts to understand about retirement planning is that every single decision you make is interconnected when you take Social Security how much you spend in retirement from which accounts you withdraw from all of these impact your account balances all of these impact how long your money will last and how much income you'll have to spend these are the big questions that we have in retirement do I have enough how long will my money last if something happens to me will my family be okay how do I pay less tax all of these things are interconnected so a lot of times we see people come in for the first time and they're one year two year three years into retirement and things are going swell and they feel like they're okay and a lot of the times that is true but what's happening is they're setting down a particular path every decision that you make sets you on a certain trajectory oftentimes in the first couple years of retirement we don't have enough visibility into how the decisions we're making today are impacting the trajectory of our expected account balances things oftentimes can feel like they're going well but we don't have that visibility to quite see hey am I on the right path or could I be making better decisions that puts me onto a better trajectory let me show you what I mean foreign so we see here this is a plan as it currently stands is at 81 percent probability of success now 81 isn't a bad number can it be improved most likely but we see in the beginning years here 2023 through 2025 all of these trajectories and we see the dispersion here they're all very closely concentrated together so the first two three four five years of retirement we do not know which one that we're on and that can lead us into a sense of complacency or a false sense of security that says hey you know what I'm doing good I'm doing great I'm on the right path because I'm three years into retirement and I still have about the same money that I started with well as you can see some of these paths ultimately diverge into the red which is not good that means you're running out of money or you've run out of money and others diverge into a much more comfortable and secure range here we see 2.5 million 1.9 million 4.7 million these are all different possible paths that the decisions you're making today and over the next several years could potentially put you on the purpose of the retirement success plan is to one identify who you are what's important to you and how do we determine what success means for you then we have a structure process that's based on your investment allocation generating income reducing taxes looking out for health care and then estate planning the retirement success plan isn't just an initial plan that set it and forget it it's a timeline for execution of the key components and also a process to continue to Monitor and make adjustments on the fly when necessary as long as we have visibility into how the decisions we're making today are impacting our future security what we find is you tend to live a more comfortable retirement and that means Comfort around the level of income that you're receiving and how much you're spending not to mention what we're doing from a tax perspective to make sure you don't carry a ton of risk and potentially pay too much tax down the road there are five key areas we feel are important to have a plan for leading into retirement at retirement and then post retirement that we continue to Monitor and adjust as needed monitor entering is an extremely critical part of the retirement success plan because again we don't really know where we're at on this trajectory in years one two three four or five it's about a relationship a partnership moving forward that allows us to have visibility into how the decisions we're making are impacting our trajectory and also allow us to change in real time when circumstances require now external events like the stock market crashing or the economy going into the tank or internal decisions such as how much we're spending or if we want to buy that vacation home or maybe we want a gift to the kids or grandkids these are all decisions that impact their trajectory that we're on so having that relationship and having that visibility is what allows us to be at peace and know hey we can do this or we can't do this or these are the parameters that we should operate in to make sure that we continue on the path that we we feel comfortable with step one of the rrsp is what we call the allocation this is a very critical step because after we've learned who you are how you define retirement success and what your goal Czar we make a recommendation of how you should spread your money across different asset classes so think stocks and other low-risk Securities one way to think about the allocation and why it's so important is if you think about ingredients in a recipe so if you have too much sugar or maybe too much salt you're not going to have something that's tasty that you nor anyone else really wants to eat but with the allocation in your retirement we're not talking about a bad pot roast that you can just redo you have plenty of time maybe next weekend we're talking about your retirement and with the wrong ingredients or the wrong allocation you could possibly run out of money maybe you have to go back to work maybe you don't have enough money to help pay for health care expenses for you or your spouse maybe there's not enough to take care of your surviving spouse so this is a very critical step in the process and that's why it's step one the framework that we use to build your allocation is what we call the core four so we have the Peace of Mind pillar we have multiple streams of income we have the growth pillar and then we have the defense or alternative pillar some of our clients have money spread across all of the core for and for other clients it makes sense to just have two or maybe three pieces of the core four but that's the framework that we use based on your goals and your circumstances to build out the allocation for your retirement step two of the RSP is the income planning process so we want to see multiple streams of income in retirement we'd like to live off interest as much as possible not get into that principle but we also want to know where our income is coming from is it coming from the retirement accounts is it coming from the non-retirement accounts because in retirement where you withdraw your income from determines how much tax you pay and also instead of having just a static four percent rule we want to have a more Dynamic plan a plan that adjusts our income either up or down based on their trajectory of our plan step three of the RSP is tax planning so tax planning is an extremely critical part of this overall process but the reason it's step three is because if we don't know what the allocation is or how much income we're getting and when we're getting that income we can't possibly do a tax analysis instead of telling you to go see your CPA to develop a tax strategy we build that in-house as part of your customized RSP here at Oak Harvest Financial Group now the reason we do that is because we believe to truly be a fiduciary and provide recommendations and advice in your best interest you must look at taxes and the impact taxes have on the amount of income you actually get to keep so a tax plan is an extremely critical part of the retirement success plan step four of the process is Health Care planning so this is one area where my grandparents and their advisors failed to get the job done and this costs them well over a half a million dollars within the first few years of retirement I don't want that to happen to you so we've built that in to the RSP if you retire prior to 65 we have to figure out health insurance many of you have concerns about end of life care or later in life care is long-term care an appropriate solution for you how do we not have premiums that continue to go up throughout retirement addressing the potential costs of Health Care in retirement is a critical step because one mistake here can cause everything else to blow up step five of the RSP is the estate planning side now a big mistake that we see clients make all the time is they go to their attorney they get the estate documents and then they never tell us so what we've done is we've built this estate planning into the financial process so first and foremost your financial planner should be the quarterback of this overall estate planning process this way assets that need to get retitled to either go into trust or other entities we make sure that gets done beneficiaries that need to be changed we make sure that gets done but also having a conversation with you about the disposition of your estate we don't want your money going to your children and then half of that going to your children's future ex-spouse so there's a lot of aspects Beyond just having a will maybe a living trust and your medical directives that we need to address and we build that into the RSP those are the five steps of our retirement success plan that we customize for you not only are these actionable items that we feel can improve your overall retirement providing better peace of mind more visibility into the future or transparency and Clarity around some of the items that are important in retirement it's also a timeline for execution of these specific items it's also a structure in a framework that allows us to continue to monitor your retirement to make sure that your plan is on the correct trajectory and that you have a successful retirement we're always producing more content to help you go more in depth with retirement success plan and the overall process to continue that Journey you'll want to click right here to learn more about what the RSP means for you and your family [Music]

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