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How Secure Are Your Digital Habits?

By Julie Leone,

October is National Cyber Security Awareness Month and a great time to check your digital awareness. As scams become more sophisticated, it’s important to stay up-to-date on keeping your account and personal information secure.

Identify your approach to cyber security by answering a few questions, and perhaps you’ll learn some simple habits to help make your digital life more secure.

Click here and test your online security knowledge.


This Is Exactly How Much Money Experts Say You Should Stash in an Emergency Fund

By Elizabeth Higman,

An emergency fund is one of the basic pillars of financial security. When you have a stash of cash set aside to cover unexpected expenses, you can avoid costly problems like racking up credit card debt or pulling money from your retirement fund.

However, too many people don’t have a solid emergency fund. Only around 60% of Americans say they have enough savings to cover a $400 unexpected expense, according to research from the Federal Reserve Bank.

Although not having an emergency fund can put your financial health at risk, the thought of establishing one can be overwhelming. Most experts advise saving enough to cover three to six months’ worth of living expenses, which will likely amount to several thousands of dollars. If that sounds intimidating, there’s good news: New research shows you might actually need much less than that stashed away in your emergency fund.

This Is Exactly How Much Money Experts Say You Should Stash in an Emergency Fund

Your emergency fund: How much should you save?

Economists may have found the exact amount you should stash in your emergency fund: $2,467.

Researchers from the Federal Reserve Bank of St. Louis and the Universidad Diego Portales in Chile studied lower-income households (since this group of people is least likely to already have an emergency fund) to see how much money it takes to lower the risk of financial disaster in the event of an unexpected expense. They discovered that, for every dollar a household saves up to $2,467, it significantly lowers the risk of experiencing financial hardship (such as skipping paying rent or bills or not receiving necessary medical care) if an unexpected expense occurs. But for every dollar households save more than $2,467, it doesn’t have the same effect — meaning that saving more than that amount doesn’t necessarily provide extra protection against financial hardship.

Of course, that’s not to say that if you save $2,467 you’re safe from every single financial obstacle that could be thrown your way. The research itself said that there’s uncertainty in the exact amount, noting with 95% confidence that the number is somewhere between $1,814 and $3,011. Moreover, it’s still always possible that you could face a significant unexpected expense that could quickly wipe out your emergency fund. However, the figure represents about one month’s worth of savings for a typical low-income household — well below the three to six months that most experts recommend.

Keep in mind, too, that researchers based this number on lower-income households, or those who fall into the bottom 30% of income distribution. Higher-earning households can struggle with emergency savings, as well, and if you have more expensive living expenses, you may need more than around $2,500 to be able to cover unexpected costs.

Building your emergency fund one dollar at a time

If you’re struggling to save anything in an emergency fund, take a look at where your money is going to see if there’s any room in your budget to make cuts. If you’re not tracking your spending, it’s easy to overspend on non-essential costs without realizing it — making it feel like you’re more strapped for cash than you really are.

Once you’ve found some extra money you can put toward your savings, make sure you’re storing your cash in the right place. A high-yield savings account is one of the best places to establish an emergency fund because you’re earning a relatively high interest rate, yet you can still withdraw the money whenever you need it. The best high-yield savings accounts earn interest rates of around 2% per year, which is far better than the dismal fraction of a percent you’ll likely receive by putting your money in a checking account or standard bank savings account.

Some people may choose to forgo the emergency fund because they’re too focused on other financial goals. You may be trying your hardest to save for retirement, for instance, and it might seem counterintuitive to change gears and start putting your money toward your emergency fund. So if you’re facing multiple financial priorities, how should you balance them?

It helps to think about the consequences of not saving for each goal. Of course, not saving for retirement can lead to problems down the road. But what happens if you don’t have an emergency fund and you’re hit with a major unexpected cost? Do you rack up credit card debt, which can hurt your credit score and make it harder to save? Or perhaps you might pull the cash from your 401(k) or IRA, which might result in getting hit with an early withdrawal fee (plus you’ll be sabotaging the hard work you’ve put into saving for retirement). Neither of those situations is ideal, but they could both be avoided with an emergency fund.

That’s not to say that other goals, like saving for retirement, aren’t important. But if an unexpected expense could potentially wreck your entire financial situation, it might be wise to prioritize your emergency fund, at least until you have a couple thousand dollars socked away. Then, once you know you’re not risking going into debt or hurting your retirement savings if you face an emergency expense, you can go back to working toward your other goals.

Establishing a stash of emergency savings may not seem like the most crucial task on your priority list, but not having a rainy day fund could lead to a domino effect of consequences if you face a significant unexpected cost. But if you prepare for these types of expenses by setting aside a couple thousand dollars in savings, you can ensure these financial obstacles won’t get in the way of achieving your goals.

To read the original article, please visit The Motley Fool.

Doing This Simple Thing Once a Year Can Help You Save More for Retirement

By Elizabeth Higman,

When you’re trying to balance multiple financial responsibilities at the same time, saving for retirement may seem like a lesser priority than your other tasks. In fact, 42% of workers say they don’t want to think about retirement planning until they get closer to retirement age, a survey from the Transamerica Center for Retirement Studies found.

Although retirement planning is not the most exciting topic to think about, you should be thinking about it long before you actually leave your job. If you put off saving or don’t know whether you’re on track, by the time you realize you’re behind, it might be too late to do anything about it.

However, if you want to ensure you’re as prepared as possible for retirement, there’s one simple thing you can do every year: Give your savings a checkup.

there's one simple thing you can do every year: Give your savings a checkup.

Why an annual (financial) checkup is crucial

If you’re saving anything at all for retirement, it’s easy to feel like you’re on the right track simply because you’re doing something. But if you’re blindly throwing money in your 401(k) or IRA without knowing whether that’s going to be enough to retire comfortably, you may be putting your financial future in jeopardy.

Saving for the future isn’t a set-it-and-forget-it situation. To make sure you’re doing enough to prepare, you’ll need to check in on your savings at least once a year, then make any necessary adjustments to ensure you’ll reach your goal by retirement age.

What exactly does a yearly checkup look like, though? To start, double-check that your retirement goal hasn’t changed. Even if you’ve already calculated the amount you should have saved by the time you retire, that number isn’t set in stone. Your annual living expenses could increase, meaning you’ll need to save more for retirement to keep up your current lifestyle. Or you might decide you’re going to move to a more expensive city once you retire, which can completely change how much you’ll be spending each year in retirement.

Run your numbers through a retirement calculator to get an estimate of how much you should be saving, as well as what you’ll have to save each month to reach that goal. If your overall retirement goal has changed, you might find you need to be saving more or less each month. It’s better to find that out early while you still have time to adjust your plan rather than wait until you reach retirement age and realize you don’t have enough saved to live comfortably.

What to do if you’re already behind on your savings

Say you’re performing your yearly checkup and realize you’ll need to start saving more than you can afford if you want to reach your goal. It may be tempting to give up, thinking that there’s nothing you can do now to catch up. But it’s still important to save what you can, even if it’s not much.

The hard truth is that depending on just how far behind you are, it might not be possible to save as much as you need. If you’re in your 50s with nothing saved, for example, you likely won’t be able to save $1 million in the next 10 or 15 years. However, that doesn’t mean you can’t save anything, and having even a little saved for retirement is far better than nothing.

If you’re behind on your savings, you’ll need to set a new, more realistic retirement goal. Think about your future expenses in retirement and consider whether there are ways to reduce them. If you’d planned on taking several expensive vacations, for instance, consider nixing those and finding more affordable ways to entertain yourself in retirement. Or if you’re currently living in an expensive city, it might be worthwhile to think about moving to dramatically lower your everyday living expenses. Of course, you can’t predict all your future costs, especially when retirement is still decades away. But by planning on living a more frugal lifestyle, you can get by on less during your golden years.

Next, see if there are ways you can start saving more now. If you don’t already, begin tracking your spending to determine if there are areas of your budget where you can cut back. Even if you feel like you don’t have a penny to spare for retirement, you might be surprised by how much room you have in your budget if you look for it. Saving even a few dollars per week in each spending category can potentially amount to hundreds of dollars per month, so it may not be as painful as it sounds to cut costs.

Finally, make sure you’re investing your money wisely. When you don’t have much extra cash to put toward retirement, every dollar counts. If you’re throwing your money in a savings account earning 1% annual interest, your savings won’t go nearly as far as if you’re investing it in a 401(k) or IRA earning a, say, 8% annual rate of return.

Managing your money can be tough, but it’s even more challenging when you don’t know whether you’re on the right track to reach your goals. To ensure your financial situation is as healthy as possible, make sure you’re regularly giving yourself a checkup. It can’ only help you save more for retirement, but it can also give you peace of mind that your finances are in order and that you’re doing everything possible to be successful.

To read the original article, please visit The Motley Fool.

BOSC’s Marie Norkett

By Julie Leone,

BOSC’s Marie Norkett attended the 3rd Annual Ladies Tea Party at Sarah’s Guest House.

Sarah’s Guest House provides lodging, transportation, meals and comfort to patients and families of patients receiving medical care in Central New York.


Do You Need a Budget If You’re Already Saving Money?

By Elizabeth Higman,

Budgeting can lend to better savings — but what if you’re already excelling in that arena?

Woman sitting on floor planning a budget

There’s a reason we’re generally told to stick to a budget: Without one, you’ll have no idea where your money goes month after month, and if that’s the case, you might struggle to eke out cash for savings. (Incidentally, you might also land in serious debt if you consistently spend more than what you earn.)

But what if you’re naturally a good saver? What if you have a healthy emergency fund and are already making consistent contributions to a retirement plan, like an IRA or 401(k)? In that case, do you really need to go through the motions of setting up a budget and reviewing it month after month? Or can you get by without one?

The benefit of budgeting

The beauty of having a budget is that it can give you real insight as to where you’re spending more money than necessary, thereby prompting you to make positive changes to your financial situation. For example, you might think you only spend $300 a month on groceries, but if it turns out that figure is closer to $400, it might serve as a wakeup call to shop more frugally and get better about seeking out bargains.

Now, many people find it difficult to save money without a budget, because they’re not only clueless about where their income goes, but they also have trouble exercising self-control. If you’re not one of those people, then technically you don’t need a budget. This especially holds true if you have your savings automated so that you’re putting money into either a bank account or a retirement plan off the bat.

Even if your savings aren’t automated, you can probably get by without a budget if you’re in the habit of living considerably below your means and your main expenses eat up a relatively small portion of your income. For example, we’re generally advised to keep our housing costs to 30% of our earnings or less. If housing only takes up about 12% of your income, that’s extremely low, and that alone might make saving money pretty easy, even if you don’t have a budget to follow. The same holds true if you’re a generally frugal person and don’t tend to spend a lot relative to what you earn.

That said, you never know when your bills might take a turn for the more expensive. Your rent could increase by $80 a month. Your car insurance could climb by $150 a year, and your promotional cable plan might expire, thereby adding $50 a month to your total spending. These costs can add up before you know it, so just because you’re managing to save now doesn’t mean you’ll continue doing so in the future. But if you take the time to create a budget, you’ll be better-equipped to handle changes in your finances without your savings taking a hit.

Creating your budget

If your absent budget is due to the fact that you don’t know how to set one up, fear not — it’s a fairly easy process. Just open up a spreadsheet and list your recurring monthly expenses. Then, factor in once-a-year expenses you should be setting money aside for each month (like your roadside assistance plan or warehouse club membership fee). Once you’ve totaled those numbers, you can see how your spending compares to your earnings. And if at any point you find that you’re no longer able to save as well as you are at present, you’ll be able to make adjustments easily.

Of course, if you’re really opposed to having a budget and are a strong saver, then you can probably continue living budget-free. But if you’re willing to put in the time, a budget could be just the thing that helps your savings stay on course.

Savings account rates are skyrocketing — Earn 23x your bank

Many people are missing out on guaranteed returns as their money languishes in a big bank savings account earning next to no interest. Our picks of the best online savings accounts can earn you more than 25x the national average savings account rate.

To read the original article, please visit The Ascent.

10 Questions to Ask Your Financial Advisor About Retirement

By Elizabeth Higman,

Whether you’re just starting to save for retirement, or you’ve been investing for years, it can be a smart move to turn to a professional for guidance. But before you choose one, here are 10 questions to ask a financial advisor about retirement.

1. What do you like about your job?

No matter what type of professional you’re looking for, it helps to find someone who likes their job—and who isn’t just punching a clock.

Ideally, your financial advisor will enjoy helping people and have a passion for all things finance, whether that’s helping you budget, pay down debt, manage healthcare costs, develop tax strategies, build wealth, and ensure you have enough income in retirement.

Body language says a lot. Is the advisor making eye contact with you, smiling, and using hand gestures while speaking (that’s good)? Or are they slumped in a chair, distracted, and staring at their phone (that’s a red flag)?

2. Which services do you provide to your clients?

Your financial advisor should offer services that will help you solve the problems you may face in retirement. That includes helping you:

  • Figure out how much you need to retire, and set savings benchmarks to get you there
  • Pick investments that match your risk tolerance and time horizon
  • Develop a long-term investment strategy
  • Rebalance your investment portfolio
  • Manage your expenses now and in retirement
  • Make plans for long-term care
  • Create a favorable tax strategy

3. What are your qualifications?

In general, you’re looking for someone with advanced financial and retirement-planning education. Designations to consider include Certified Financial Planner (CFP®), Chartered Financial Consultant (ChFC®), and Chartered Life Underwriter (CLU®).

Another credential high on the list is Retirement Income Certified Professional (RICP®), which involves retirement-specific planning training and education. Verification sites such as Designation Check can help you search for a qualified professional, or verify that the certification he or she claims is accurate.

4. Are you a fiduciary?

“Fiduciary duty” is a legal term that means that one party has the obligation to act in the best interests of the other party. You want your advisor to be pointing you toward investments that are in your best interest—not theirs.

It’s great if the two coincide, but yours should come first. A hint: Fee-only advisors are more likely to assume fiduciary duty than those who work on commissions.

5. How will I compensate you?

It’s important to know upfront how you’ll compensate a potential retirement advisor. You should ask whether you’ll pay hourly, per transaction, or annually, based on the value of your assets. Other advisors may be compensated through commissions on the products they provide.

This isn’t to say you should necessarily avoid someone who charges more. A high-priced advisor may well be worth the fee you pay if the results are valuable to you. Be wary of commission-based compensation, however, as it could mean the advisor will steer you into buying products with higher fees.

6. Does your firm hold my money and investments?

Your financial advisors shouldn’t come into contact with your assets (except for the fees you pay for their services). Instead, the advisor should contract with a reputable custodian, which could be a third party or owned by their firm.

The custodian holds your assets and will also process transactions, collect dividend and interest payments, make distributions, and produce monthly statements. Well-known third-part custodians include Charles Schwab, Fidelity Institutional, Pershing/BNY Mellon, TD Ameritrade, and LPL Financial.

7. What’s your investment philosophy?

This is the most basic of questions and one any retirement advisor should be able to answer without hesitation. You should hear about the discipline behind investment strategies and how those strategies will help you achieve an annual return designed to reach your investment goals. This should all be provided in simple terms you can understand.

Also, you should receive information designed to make sure you understand and are able to navigate tax laws and avoid emotional responses to market fluctuations.

8. How will we touch base about my investments?

You should expect contact on a quarterly basis at a minimum. Monthly is even better. Your advisor should explain every buy or sell transaction. And they should provide periodic reviews of the status of your portfolio, including educational resources if appropriate (or if you ask for them).

9. What happens to my money if something happens to you?

Your advisor should be able to answer this question in enough detail that you’re confident there’s an exit plan if he or she retires, leaves the firm for another job, or is otherwise unable to continue serving you. You should know how your financial affairs will be handled and who would handle them.

10. Is there anything I forgot to ask you?

Ending an interview with this question can be very revealing. Even if you think the answer is no, it can demonstrate a level of engagement with a potential financial advisor. Still, there’s a chance you missed something during your conversation, and this is a good time for the advisor to bring up anything important.

The Bottom Line

Asking the right questions and listening carefully to the answers you receive helps you decide if there’s a good match. If you’re part of a couple, both partners should feel comfortable with the financial advisor. Philosophy, fees, qualifications, and more all come into play.

Remember, choosing a retirement advisor is not an easy task. You may have to interview several candidates before you find the right one.

To read the original article, please visit Investopedia.

Our Office Hours

By Julie Leone,

We will resume normal offices starting this Friday, September 6th- our office will remain open until 5 pm Monday-Friday.

Fall is a wonderful time to schedule an appointment so that we can sit down one on one and review your financial path.

We are here for you at 315-471-2672.

Interesting Study: Benefits of Working with an Investment Advisor

By Julie Leone,

A recent study performed by Charles Schwab found that only one in five self-directed brokerage account participants worked with an advisor in the second quarter of 2019, but those who did had larger balances than non-advised participants. Past performance is no indication of future performance.

To read the entire reports please click on the link here: Study Investment Advisory


Blue Ocean Strategic Capital, LLC was established in 1997.  Our continuous dedication to high-quality service along with a client-centric approach has allowed the company to grow significantly and we now provide planning and asset management for individuals, retirement plans and charitable organizations in fifteen states. We are here to assist you in your individual concerns and goals.






Are You on Track? Financial Planning Goals for Every Decade of Your Life

By Elizabeth Higman,

Are You on Track? Financial Planning Goals for Every Decade of Your Life

Your career and lifestyle look completely different when you’re in your 20s compared with when you’re in your 60s: Your financial focus and planning in each decade should follow suit.

Each decade is riddled with its own risks and problems, so it’s important to know what to expect. Which decade can you afford to take more risk? Which decade should you really start to plan for retirement? Which decade should you focus on managing debt?

Set yourself up for future financial success by living each decade to its fullest.

Written by Jamie Hopkins, Esq., LLM, MBA, CFP®, RICP®. He serves as Director of Retirement Research at Carson Wealth and is a finance professor of practice at Creighton University’s Heider College of Business. His most recent book, “Retirement: Rewiring The Way You Think About Retirement,” details the behavioral finance issues that hold people back from a more financially secure retirement.

Are You on Track? Financial Planning In Your 20s

Planning In Your 20s

Tip No. 1: Invest in Yourself
When you are in your 20s and just starting a career, take time to invest in yourself. This might mean going back to school to earn a master’s degree or professional certification. Take the time to grow your human capital, life experiences and knowledge — it doesn’t get easier to invest in yourself later on in life.

Tip No. 2: Build Your Positive Financial Behaviors
Start by saving. Put money into your employer’s 401(k) or set up an IRA. Even if you can only put a few hundred dollars away, work on developing and automating your savings.

Tip No. 3: Take Some Risk
When you’re young is the best time to take risk. It’s true from both an investment standpoint and a life standpoint. When investing, look for equities and don’t invest too conservatively — you have a long time horizon to let your money grow.

Take risks in life, too. Look for start-ups and opportunities that will let you grow and flourish. I know many young people just want a sure thing in their first job. However, a company that will grow and help you grow might be a better fit in the long run.

Are You on Track? Benchmarks for Your 20s

A rule of thumb for your 20s:
By the end of your 20s, try to develop an emergency fund that holds three to six months of your living expenses in cash or an easily accessible investment with low risk.

How much you should have saved by the end of your 20s:
An amount that’s one to three times your starting salary.

Are You on Track? Financial Planning In Your 30s

Planning In Your 30s

Tip No. 1: Manage Your Debt
In your 30s it’s vitally important you manage debt obligations carefully. If you have student, personal or car loans, credit card debt or a mortgage, you need to have a plan for how to pay them off — and which ones to tackle first. From a behavioral standpoint, some suggest you should tackle low-balance accounts first, to get the satisfaction and reinforcement of quickly paying them off. On the other hand, a financial planning approach suggests you tackle high-interest-rate debt first to save on interest costs. Either way, get a plan, and get started. What really matters is that you don’t overborrow.

Tip No. 2: Get Proper Insurance Coverage
One of the biggest risks for many people in their 30s is they’re still acting as if they’re invincible. This leads to many people being underinsured. Make sure you have the right health care coverage, car insurance, property and casualty for your home, disability insurance and life insurance. Especially as your wealth starts to grow — perhaps along with a family — your insurance and financial needs will continue to change.

Tip No. 3: Start Building Up Retirement Assets
Hopefully your career is blossoming and you’re able to set aside money. This means increasing how much you’re saving for retirement. If you work with an employer that offers a 401(k), consider increasing your salary deferral. If you run your own company, look into setting up a SEP or SIMPLE IRA to help you set aside more money each year for the future.

Are You on Track? Benchmarks for Your 30s

A rule of thumb for your 30s:
By your mid- to late 30s, it’s ideal to be saving anywhere from 10% to 15% of your income each year for the future. The more the better. Remember that saving an additional 1% of income each year can lead to tens of thousands more money saved for retirement.

How much you should have saved by the end of your 30s:
An amount that’s three to six times your current salary.

Are You on Track? Financial Planning In Your 40s

Planning In Your 40s

Tip No. 1: Build Your Wealth
In your 40s, you’ll likely hit your peak earning years. This means it’s actually time to start building your wealth. Make sure your investments are properly aligned with your future goals and continue to be heavily invested in growth assets.

Tip No. 2: Cut Back on Unnecessary Expenses
By your 40s, you’ve probably picked up some unnecessary spending habits or costs along the way. Now is a good time to review your overall budget, spending and expenses. Perhaps you have too many entertainment subscriptions, are paying too much for your phone bill, or your car doesn’t fit your lifestyle. Any of these things could be changed and perhaps bring down your spending.

Tip No. 3: Take Care Of Yourself
The midlife crisis can start to sneak up on people in their 40s. Many people feel burned out or stressed at work — it’s important to take care of yourself. Set aside time to do financial planning and wellness. Taking control of your finances can help you take care of yourself and reduce stress. Burning out could negatively affect your health and finances and add additional layers of stress onto an already challenging situation.

Are You on Track? Benchmarks for Your 40s

A rule of thumb in your 40s:
Focus on increasing your savings and investing heavily in long-term growth assets, such as equities and other investment growth assets.

How much you should have saved by the end of your 40s:
Six to 10 times your current salary.

Are You on Track? Financial Planning In Your 50s

Planning In Your 50s

Tip No. 1: Get a Grip on Retirement Income Planning
Retirement income planning should start in your 50s. This means sitting down and seeing how much you have saved, listing your expenses and figuring out the income you can generate in retirement. If there’s a shortfall projected, you still have time to restructure your plan. That could mean saving more or cutting expenses. It’s also a good time to look at other retirement income sources, including a deferred income annuity, and to review your investment allocation.

Tip No. 2: Look into Long-Term Care Planning
While long-term care planning is not what everyone dreams about for their 50s, it’s likely the best time to do planning. With retirement starting to creep into your mind, one of the biggest risks you face in retirement should also be front and center. Long-term care insurance and funding strategies are best purchased and reviewed in your 50s. Once you get into your 60s, it can be harder to qualify for long-term care coverage. Take a look in your 50s and decide if it makes sense for you.

Tip No. 3: Think About Family and Next Generation Planning
In your 50s you might be getting pressure from both sides of your family — your parents, who are likely well into retirement now, and your children. Planning for how you’ll help everyone in your family is crucial, both your children and parents. For children, hopefully you started saving for college expenses as soon as possible, but you need to discuss other financial topics as your children migrate out of the home. But just as important, you need to discuss how you will support and take care of aging parents. All of this planning needs to start with open and honest conversations at the family level.

Are You on Track? Benchmarks for Your 50s

A rule of thumb in your 50s:
As you start to think about retiring and wonder if you have enough saved, a good rule of thumb is to have saved 25 times what you plan to spend each year in retirement. So, if you want to spend $100,000 a year from your savings in retirement, you should retire with $2.5 million. This figure doesn’t take into account any income you might receive from Social Security or a pension, which could significantly lower the amount you need saved. But let’s say your Social Security is $40,000 a year. Well then your investments only need to provide $60,000 a year, or $1.5 million, which is still a lot. However, most retirees do not need $100,000 of cash flow to meet their needs. But since you still have time until retirement in your 50s you can start to increase your retirement savings or even plan to work longer. By working longer you can reduce the amount of money you need saved for retirement and allow yourself more time to save money.

How much you should have saved by the end of your 50s:
Eight to 15 times your current salary.

Are You on Track? Financial Planning In Your 60s

Planning In Your 60s

Tip No. 1: Turn Savings into Retirement Income
You’ve spent your whole working career saving, investing and paying off bills. Now it’s time to turn your savings into retirement income. This decision requires a lot of planning because you need to make this money last for the rest of your life — and no one knows how long that’ll be. Working as long as you can and deferring Social Security are two ways to help ease longevity concerns.

While a lot of people call longevity a risk, it’s a good thing. However, it does make other risks, like health care, long-term care and inflation, more dangerous to the sustainability of your retirement income. So, get a plan in place and know how you’ll generate income, when you plan to retire, when to claim Social Security and when to put the plan in motion.

Tip No. 2: Re-Evaluate Work and Meaning
Retirement is not just a financial planning topic, it’s a long and real part of your life. Finances are just a means to an end — the end is your goals and what you want to accomplish in retirement.

Make sure you take the time to envision what life will be like after you stop working. Take a look at what you want to do and consider phasing into retirement by going part-time. If you’re single, retirement could be more challenging for you since you leave behind the relationships you’ve built in your workplace.

Staying engaged during retirement is important. For those who might become isolated, it’s crucial you have a plan on how you’ll find meaning, happiness and value in retirement.

Tip No. 3: Brush Up on Your Estate Planning
While you should start your estate planning basics early in life, when you near retirement, it’s good to do a full overview of your estate planning. This can include reviewing what insurance you have and whether it’s still needed or if you need more. You also need to review your estate planning documents to make sure they’re in order and that all of your assets are properly titled. Do another beneficiary review, especially as assets start to get turned into retirement income.

Are You on Track? Benchmarks for Your 60s

A rule of thumb in your 60s:
As you head into retirement, make sure you understand the 4% safe withdrawal rate for retirement spending. The rule states that historically in the U.S., with a 50% bond investment and a 50% stock investment, you could afford to spend 4% of your investments a year and not run out of money for 30 years. This is a conservative approach, but it does give a good starting point on how much you can spend in retirement.

How much you should have saved by the end of your 60s:
10 to 25 times your current salary, depending on spending goals and other income sources.

Are You on Track? Financial Planning In Your 70s

Planning In Your 70s And Beyond

Tip No. 1: Enjoy Life
You’ve worked hard your whole life, and you should enjoy your retirement. Having a sound financial plan that shows what you can spend and how long your money will last can allow you to do just that. A lot of people worry about having enough money in retirement, so they hoard their money, refuse to spend it and ultimately don’t enjoy themselves. They’re too fearful about the uncertainty of the future. Having a plan can help you live the lifestyle you want.

Tip No. 2: Make Your Money Last a Lifetime
A big part of planning for retirement while working and is about saving, investing and growing your wealth. Once you get into retirement, you need to monitor how your plan is doing and make any adjustments necessary. Your situation, the markets and your goals will change as your lifestyle changes. As such, you can’t stick with one plan from the first day of retirement to day 10,000 (nearly 27 years into retirement).

Don’t forget to plan and manage your required minimum distributions (RMDs) from IRAs and 401(k)s. Optimizing these assets can require new types of planning and tax strategies. As you start to spend down your money, keep track of your spending percentage of your assets. Use the 4% rule to help monitor your plan over time. If your withdrawal rate from your assets starts nearing 8% to 10%, you might want to consider cutting back on expenses. On the flip side, if your spending percentage of your overall assets drops down below 3%, you could actually increase your spending.

Tip No. 3: Complete Your Legacy and Charitable Planning
You should have started estate planning well before your 70s, but when you enter retirement you’ll have more time and energy to focus on leaving behind a legacy. Legacy planning isn’t just about taxes and estate planning — it’s more about meaning and impact. It can mean passing on security to family members, giving back your time to charities, or funding a worthwhile and meaningful initiative you care deeply about. Giving back in retirement will keep you more engaged and reduce the likelihood of becoming isolated and suffering from depression.

Additionally, after you hit age 70½ and need to take RMDs from an IRA, some great charitable giving strategies, like qualified charitable distributions (QCDs), are available to retirees. QCDs allow you to take a distribution in an IRA, send it directly to a charity, help offset your RMD requirements for the year and have it not treated as part of your taxable income.

Are You on Track? Benchmarks for Your 70s

A rule of thumb for your 70s and beyond:
Now that you’re in retirement, you need to track your spending and the longevity of your retirement portfolio. The biggest rule of thumb is realizing you might be underestimtating your life expectancy. For instance, for those who are alive at age 65, there’s a greater than 50% chance for a couple that one individual will live to 90 and almost a 25% chance one will live to 95. Plan to have many years ahead of you. Longevity isn’t a risk — it’s a gift for those who plan. Don’t plan for the middle, plan for the end point.

How much you should have saved for retriment by age 70 and beyond:
Honestly, it’s no longer time to be thinking about savings. Instead, it’s time to be thinking about income. If you want to make your money last, your withdrawal rate has to be reasonable. If it gets up to 10% of your portfolio balance per year, you have a risk of running out of money. Try to keep it closer to 4 % to 5% of your total wealth that you’re spending down.

To read the original article, visit Kiplinger’s website.

Labor Day Hours

By Elizabeth Higman,

Our offices will be closed Labor Day—Monday, September 2—and we will resume normal business hours on Tuesday, September 3. We hope everyone enjoys a safe and happy long weekend!

Special Labor Day Hours for BOSC