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Nearing Retirement? Give Yourself This Gift This Holiday Season

Kristie Cahill • Dec 23, 2019

It’s that time of year again. Time to buy gifts for spouses, children, and all the other friends and family who play a meaningful role in your life. Have you finished your Christmas shopping?
 
If you’re approaching retirement, you may want to give yourself a gift this year. No, not an expensive gadget or vacation. Rather, use this holiday season to give yourself the gift of a financially stable retirement.
 
The new year will be here before you know it. Take some time now to review your retirement strategy so you can take action and start 2020 on the right foot. Below are a few tips to get you started:

Increase your retirement contributions. 

Do you make retirement contributions to a 401(k), IRA, or another qualified retirement plan? These types of accounts are powerful retirement savings tools because of their tax-deferred status. You don’t pay taxes on growth as long as the funds stay inside the account. That may help your qualified savings compound at a faster rate than they would in a taxable account.
 
Consider increasing your contributions to your 401(k) or IRA in 2020. You can contribute up to $19,500 to a 401(k) in 2020 if you are under age 50. That number increases to $26,000 if you are age 50 or older. You can also contribute up to $6,500 to an IRA, or up to $7,000 if you are 50 or older.1
 
Of course, it may not be possible for you to increase your contribution to the maximum level without busting your budget. Any increase in contributions is helpful. One effective strategy is to gradually increase your contributions over time. For example, you could set up your 401(k) contribution to increase 1% every year or even every six months.

Reduce your exposure to risk.

If you’re like many people nearing retirement, you’re not as comfortable with risk as you once were. That’s natural. Many people become more risk-averse as they approach retirement. After all, you don’t have as much time as you once did to recover from a market loss.
 
There are a few steps you can take to reduce your exposure to risk. One is to review your allocation and risk tolerance and make sure they’re aligned. Your risk tolerance is your specific comfort level with market volatility. It’s based on your unique needs, goals, and time horizon.
 
As you get older, your risk tolerance may change, so it’s important that your strategy changes along with it. You could shift your strategy to more conservative assets that have less exposure to risk and volatility. You could also utilize financial vehicles that offer growth potential without the chance of downside loss. A financial professional can help you identify strategies that can reduce your risk exposure.

Guarantee* your retirement income. 

Are you approaching retirement? If so, this may be the time to start thinking about your retirement income. You’ll likely receive income from Social Security. Maybe you’ll even receive a defined benefit pension. However, you also may need to take distributions from your 401(k), IRA, or other retirement savings.
 
Often those withdrawals aren’t guaranteed. A market downturn could limit your ability to take retirement income. Or if you withdraw too much in the early years of retirement, you may not have assets left in the later years.
 
Fortunately, you minimize these risks by creating guaranteed* income from your retirement savings. There is a wide range of retirement vehicles available that you can use to convert a portion of your retirement savings into income that is guaranteed* for life, regardless of what happens in the market or how long you live.
 
Ready to give yourself the gift of financial stability? Let’s talk about it. Contact us today at Haven Wealth Management. We can help you implement a strategy. Let’s connect soon and start the conversation.
 
1https://www.irs.gov/newsroom/401k-contribution-limit-increases-to-19500-for-2020-catch-up-limit-rises-to-6500
 
*Guarantees provided by annuities, including optional benefits, are backed by the claims-paying ability of the issuer, and may contain limitations, including surrender charges, which may affect policy values
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
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3 Financial Developments to be Thankful for in 2020

By Kristie Cahill • 18 Nov, 2020
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By Kristie Cahill • 13 Oct, 2020
This may be the scariest time of the year, but it only lasts a month. The truth is there could be gaps in your investment strategy that could come back to haunt you for years or even decades. Below are a few common retirement planning mistakes that can have frightening long-term consequences. If any of these sound familiar, it may be time to meet with a financial professional.

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By Kristie Cahill • 05 Oct, 2020
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The United States set a somber record on Thursday, July 16, 2020, with more than 75,000 new COVID-19 cases. In fact, the U.S. set new single-day COVID-19 records 11 times between June 17 and July 16. Dr. Anthony Fauci predicts the country will soon top over 100,000 new cases each day.

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By Kristie Cahill • 03 Aug, 2020
Social Security is a critical piece of the income puzzle for most retirees. In fact, half of married retirees and nearly 70% of unmarried retirees rely on Social Security for more than 50% of their retirement income.1 Your Social Security benefit amount is based on a few factors, including your career earnings and your age at the time you file for benefits. However, your benefit amount isn’t locked-in forever. It often increases each year because of something called COLA.2  [...]

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The first half of 2020 has been a rollercoaster ride. The COVID-19 pandemic completely altered our way of life and threw the economy into a tailspin. Most states have started the reopening process, but there is still significant uncertainty about the long-term impact of coronavirus and how long the pandemic will continue. Federal Reserve Chairman Jerome Powell recently said the economy faces a “long road” to recovery, and predicted the process may take through 2022.1 Whil [...]

What's Next for a COVID-19 Economy?

By Kristie Cahill • 09 Jun, 2020
The economic fallout from the coronavirus pandemic continues, even as states start to reopen restaurants, retail stores, and other businesses. The crisis brought an end to the bull market that started in 2009 and threatens to usher in a recession.1 What does the future hold for the stock market and the economy? When will the economy recover? And how will this crisis impact your retirement and your financial future? It’s impossible to definitively answer those questions. In [...]

What Do Zero-Percent Interest Rates Mean for You?

By Kristie Cahill • 16 Apr, 2020
​The coronavirus pandemic has launched the country, and the world, into uncharted territory. In much of the world, society is essentially shut down. Schools and large events are closed. People are staying in their homes. Businesses have effectively closed across the country. The economy has felt the impact of the pandemic. Stocks have declined significantly, and unemployment has surged. On March 3, the Federal Reserve took action by cutting the fed funds rate to 0%. The Fed exp [...]

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By Kristie Cahill • 26 Mar, 2020
​The 2020 election cycle is in full swing. It’s primary season, which means the general election is right around the corner. Before you know it, the two major parties will have their conventions and we’ll be heading to the ballot box. Of course, you may already have election fatigue. From the local level all the way up to national races, candidates are already flooding television with political ads. As is the case in most presidential elections, candidates are [...]

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By Kristie Cahill • 28 Feb, 2020
It may be the end of February but it’s not too late to make a few resolutions for the new year and the new decade. Take a look at a few of the weirder resolutions we’ve heard… In 1669, author Jonathan Swift made a resolution to “not be fond of children.” Mathematician Godrey Hardy made a resolution in the 1930s to be the first man to climb Mt. Everest and to become the combined president of the USSR, Germany, and Great Britain. That would have been quit [...]
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