By Mark Lloyd -- The Lloyd Group, Inc.
SUWANEE, Ga., March 24 /PRNewswire/ -- Success in retirement takes the same discipline and attention to detail as we applied in building our career, family life or investment portfolio. A checklist helps navigate this process. Here are my Top Six points for a pre-retiree's (or soon-to-be retiree's) financial planning checklist.
Should I retire -- or stay in the workplace? Our work and free time goals, family issues, health, and marketability in the workforce all impact this important decision. From a financial standpoint, here's what you must consider: -- Will my retirement account provide 80% of my current income presently?
If the answer is no, then you would need to prepare for a considerable
lifestyle change.
-- If I have a defined contribution plan (401k, 403b, IRAs, etc.), what
will be my accumulated balance? It is imperative during retirement to
rebalance your savings plan to ensure that it is protected and will
last for your lifetime. There are specific plans available that are
designed to achieve that goal. Should I take a reduced pension (providing a survivor benefit) or a life only pension that ends at my death? Pension options include: Single Life, which lasts until the retiree passes away or Survivorship, which is designed to support the spouse after the retiree passes away. This option reduces the monthly pension payment. Some retirees have a choice to take a lump sum in retirement and invest it for their spouses' and their children's future. Seek professional help in making the best decision for you.
IRA distribution/savings plan rollover. Due to their tax-deferral and self-directed features, IRAs remain an outstanding investment, regardless of tax bracket. Many workers can take advantage of "rollovers" from company- sponsored plans to individual IRAs upon retirement, preserving tax-advantaged investment growth. Be on alert that IRAs do have distinct and sometimes complicated rules when it comes to taxation (i.e. Roth vs. traditional IRA), when distributions must be taken, ownership structure, beneficiary designations and transfer upon death. Just two examples: IRAs cannot be transferred to trusts during a lifetime and they cannot be jointly owned like property.
Plan on taxes/Plan for taxes. Many retirees will not see a tremendous difference in their tax bracket when it is time to take IRA distributions. At 70 1/2 it is mandatory to start withdrawing the required minimum distribution from your traditional IRA or defined contribution plans such as 401k, 403b, etc. (RMD). To reduce future income tax, it may be beneficial to take distributions from your retirement plan earlier.
How to use your nest egg in retirement is just as complex as funding your nest egg. The stakes are even higher for today's retirees and pre-retirees. Having a strong pre-retirement flight plan will help you soar to your anticipated retirement rewards.
Founded in 1994 by Mark Lloyd, The Lloyd Group, Inc. solely serves the distinctive financial needs of those nearing retirement and those already retired. The Lloyd Group, Inc. is a member of the Metropolitan Atlanta Better Business Bureau and the International Association of Registered Financial Consultants.
Mark Lloyd is an approved member of the National Ethics Bureau and the Million Dollar Round Table "Top of The Table." He is an Investment Advisor Representative and advisory services are offered through Envision Investment Advisors, LLC, a Registered Investment Advisory Firm. DATASOURCE: The Lloyd Group, Inc.
CONTACT: Andrea Bogos for The Lloyd Group, Inc., +1-248-258-2333,
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