THE JOURNEY BEGINS HERE

Transcription

1 THE JOURNEY BEGINS HERE A check for you. It is good to have an end to journey toward; but it is the journey that matters, in the end. - - Ernest Hemingway Securities and Investment Advisory Services offered through Voya Financial Advisors, Inc. member SIPC. Egan, Berger & Weiner, LLC is not a subsidiary of nor controlled by Voya Financial Advisors, Inc.

2 RETIREMENT BRINGS WITH IT A MYRIAD OF CHANGES TO YOUR LIFE Retirement brings with it a myriad of changes to your life, many will be anticipated, some will not. There are financial changes, emotional changes, relationship changes and more. How you handle these changes will be important factors in enjoying your retirement vision. LifeCheck is designed to help you address the financial changes that will be occurring. This workbook has resources to help you understand the emotional changes; we highly recommend that you spend some time focusing on this aspect of your retirement. RISKS CHANGE IN RETIREMENT WORKING YEARS LOW RISK Purchasing Power Longevity Healthcare RETIREMENT YEARS HIGH RISK Market Fluctuations Insufficient Growth Rate Managing your money in retirement is very different than managing your money while working. During your working years you prioritized returns you often had a long time horizon that was fairly well defined and somewhat flexible. You were constantly adding new money and inflation was less of a concern. In retirement none of these hold true. Income and preservation become priorities. Inflation becomes a primary concern and your time horizon is impossible to define. While investment returns are important, how those returns come to you is even more important. LOW RISK Market Fluctuations Insufficient Growth Rate HIGH RISK Purchasing Power Longevity Healthcare Withdrawals from your investments could amplify the effects of negative market returns, increasing the risks of you outliving your money. A few bad years during the beginning of your retirement could negatively impact your ability to achieve your goals. 2

3 YOUR LIFE S JOURNEY PAGE 4 1 HOW LONG WILL YOU LIVE? HOW HAVE YOUR ATTITUDES CHANGED? 2 PAGE 5 PAGE 7 WHAT ABOUT SOCIAL SECURITY? 3 4 3) HOW HAS YOUR SPENDING CHANGED? PAGE 8 PAGE 9 5 YOUR PERSONAL INCOME STRATEGY! A check for you. 3

4 #1 HOW LONG WILL YOU LIVE? This is a very important question, and one that is virtually impossible to answer with any degree of certainty. Americans are living longer than ever before. According to the Social Security Administration, one in four 65 year olds will live to age 90 and one in ten will live to age 95. According to a Boston University study, centenarians, those living past age 100, are the fastest growing segment of the US population in terms of age. The US Census Bureau reports that the number of centenarians doubled to 72,000 over the past 20 years and could balloon to as many as 4.2 million by While the average life expectancy for today s 65 year old is 83, it is very possible that you could live well past that age. Prudent financial planning should account for you or your significant other, if you re planning with one to live a longer than expected life. Running out of money in later life could mean a loss of independence and the possibility becoming a burden on your family. There are two ways that the financial planning industry estimates life expectancy: using current life expectancy tables or using a fixed planning age, say 95. Both of these methods seem fairly arbitrary and don t take into account your personal history, habits and lifestyle. We ve seen that planning too short has negative implications, but planning for too long of a life has short-comings ONE IN FOUR ONE IN TEN as well. At Egan, Berger & Weiner we prefer a more personalized method to help us estimate your life expectancy. We recommend that each of our clients take a test like those offered by RealAge.com or Livingto100.com. By answering very specific questions about your health, habits and familial history, these tests may offer insight into whether you will live longer than the average person. We don t ask that you share with us the report, only the age, which we will use in your custom LifeCheck strategy YEAR-OLDS LIVE TO BE 90 YEAR-OLDS LIVE TO BE 95 4

5 #2 HOW HAVE YOUR ATTITUDES CHANGED? 1) Rank the following statements in order of importance (1 being lowest - 5 being highest) I do not want to outlive my assets: I want to ensure that my income keeps up with the rising costs of the things I buy I prefer a predictable income stream I want to make sure that I always have access to all of my assets I prefer that the value of my assets does not fluctuate with the stock market ) How soon do you plan to begin withdrawing from your investment assets? o Right away o 1 3 years o 4 9 years o Over 10 years o I do not plan to withdraw from my investment assets 3) Based on life expectancy tables, the average 55 year old American female can expect to live to 83 years of age, and the average 55 year old American male to 80 years. Considering your current health and family history do you expect to live a shorter, longer or average life expectancy? o Shorter o Average o Longer 4) How important is it that you leave assets to your heirs or to a charity? o Not at all important o Nice if it happens, but not my priority o Definitely want to include this in my plan 5) If your annual retirement income were to decline by 10% or 15% how would you characterize the impact on your lifestyle? o A large impact, I will likely have to make some very tough decisions o A medium impact, I will have to make some changes but nothing drastic o No real impact as there is room in my budget to make some cuts 5

6 #2 HOW HAVE YOUR ATTITUDES CHANGED? 6) Do you own a long-term care insurance policy? o Yes o No 7) How would you best describe your tolerance for fluctuation in your annual retirement income? o Low tolerance, I really would like steady income o Medium tolerance, steady is great, but I can handle some changes o High tolerance, I am okay with fluctuations 8) Would you be willing to trade access to some of your money for a more stable income stream? o Yes o No 9) What is most important to you, getting the most income you can from your investments or getting the most stable income you can from your investments? o Most income o Stable income 10) If your investments which were valued at $50,000 were to decline to $39,000 within one year, what would you most likely do? o Sell all of my investments and move to safer investments o Sell only the investments that lost money o Do nothing o Invest more as the declining value of the market may represent an opportunity 11) If your portfolio declined by an additional 10% to $35,100 in the following year, what would you most likely do? o Sell all of my investments and move to safer investments o Sell only the investments that lost money o Do nothing o Invest more as the declining value of the market may represent an opportunity 12) When it comes to investing, I would describe myself as: o An investor with limited knowledge about investing or investment experience o An investor with basic knowledge about investing and some investment experience o An investor with considerable knowledge about investing and significant experience o An investor with vast knowledge about investing and extensive experience 6

7 #3 HOW HAS YOUR SPENDING CHANGED? Income Per Month Social Security 1 $ Social Security 1 $ Pension 1 $ Pension 2 $ Rental Income $ Needs Per Month Home Mortgage/Rent $ Property Tax $ Insurance $ Electric $ Gas $ Water $ Telephone $ Maintenance $ Car Loan $ Insurance $ Gas $ Maintenance $ Medical Insurance $ Doctor $ Prescriptions $ Income Per Month Part Time Work $ Investment $ NET INCOME $ Needs Per Month Medical (cont) Medicare B $ Insurance Life $ Liability $ Long Term Care $ Debts Credit Card 1 $ Credit Card 2 $ Daily Groceries $ Misc. TOTAL NEEDS $ Wants Per Month Cable TV $ Dining Out $ Hobbies/Clubs $ Travel $ Pet Care $ Charity $ Gifts $ Allowances $ A NEED SOMETHING YOU MUST PAY EACH MONTH VS A WANT SOMETHING NICE TO HAVE BUT NOT A NECESSITY Wants Per Month Subscriptions $ Entertainment $ Clothing $ TOTAL WANTS $ SUMMARY Per Month NET INCOME $ TOTAL EXPENSES $ MONTHLY SURPLUS/DEFICIT $ 7

8 #4 WHAT ABOUT SOCIAL SECURITY? Social Security is a very important, yet often over-looked part of your retirement strategy. The value of an inflation adjusted stream of income, guaranteed to last as long as you do shouldn t be under-estimated. Proper management of this important resource can often mean the difference of hundreds of thousands of dollars over your lifetime. The following Social security strategy is based on the information which you have provided to us. Our main objective in creating this strategy for you is to balance two important goals: maximizing the total lifetime income you collect from Social Security and providing income protection if you should have a greater life expectancy than planned. This is a brief summary of our recommendations. A more detailed analysis is included as part of your LifeCheck TM strategy. Please be sure to review it for more details. YOUR PERSONALIZED CLAIMING STRATEGY should file for benefits at age and immediately suspend them. should file a restricted application for spousal benefits at age. should file for benefits based on his/her own work record at age. should file for his/her benefit at age. should file for his/her benefit at age. is not eligible for Social Security benefits. is not eligible for Social Security benefits. 8

9 #5 YOUR PERSONALIZED INCOME STRATEGY? % of your NEEDS in retirement should come from these sources A CERTAIN % from your spending plan are currently covered by guaranteed sources such as Social Security, a pension or other forms of income. o o Based on our strategy and your answers to the retirement questionnaire, you have enough income from guaranteed sources. OR Based on our strategy and your answers to the retirement questionnaire, you should consider increasing your guaranteed income amounts to $. You should consider placing $ in the following investment vehicles to accomplish your goal.. REMAINDER OF YOUR NEEDS AND ALL OF YOUR WANTS should come from these 3 sources of income Long-term Investments Short-term Investments Cash 9

10 WISH LIST/ DREAMS COME TRUE! A wish is something aspirational, a hope or a desire. Wishes are great to dream about but if your finances require, they can be altered to fit. Some people would like to leave money to family or a favorite charity, this is a wish. Please tell us about your own wishes below. Wish Amount #1 $ #2 $ #3 $ #4 $ #5 $ CURIOUS LIST Retirement isn t just a financial event, it is also an emotional event. Happiness in retirement is often about staying active, learning and doing new things and being social. A curious list is simply a list of subjects that you would like to explore further at some point during your life. Take a few minutes to think about your own curious list

11 ENJOY LIFE S JOURNEY Welcome! You have reached the conclusion of the LifeCheck journey. This however is not a destination at all; rather it is a tool that will help you enjoy your life s journeys. With this plan in place we hope that you will feel empowered and confident enough to go forward, live life to the fullest, follow your passions and achieve your vision. This plan is not stagnant, in order to be of the most value it must change and adapt to both internal and external forces. We look forward to seeing you soon, updating your plan and of course, hearing all about your journey. Thank you for the opportunity to be a part of your future. We hope you re as excited as we are. The EBW Team RETIREMENT RESOURCES Fairfax County Virginia Insurance and Counseling Assistance Program. A program intended to assist you in selecting the best retirement health insurance coverage for your situation Medicare Plan Finder can help you weigh through the myriad choices of Medicare supplement plans Offers tips for comparing and selecting Medicare health plans and drug coverage. 4. Socialsecurity.gov The Social Security Administration s website can help you calculate and apply for your benefits. 5. Seniornavigator.org A website that provides free information about the health and aging resources available to Virginians. The information focuses on issues such as health, financial concerns, legal questions, health facilities, housing options, transportation, exercise programs, advocacy, and more. 6. AARP.org One of the leading advocacy groups for Americans 50 years of age or older. 7. Seniorcorps.gov - Senior Corps connects Americans 55 and over with the people and organizations that need them most. They help them become mentors, coaches or companions to people in need, or contribute their job skills and expertise to community projects and organizations NIHSeniorHealth makes aging-related health information easily accessible for family members and friends seeking reliable, easy to understand online health information. NIHSen-iorHealth features authoritative and up-to-date health information from Institutes and Centers at NIH. 9. AAA.com Travel and automotive information. 10. Frommers.com Good vacation and travel site with a link specifically for seniors. 11. Volunteermatch.org A website that connects volunteers with causes that they find important. 12. VOA.org Volunteers of America is a faith based organization which matches volunteers with those who need them. 13. HUD.gov Housing assistance. 11

12 A check for you Gallows Road, Suite 980 Vienna, Virginia (703)

13 ABOUT YOU AND YOUR FAMILY Gender YOU YOUR PARTNER Date of Birth / / / / Marital Status Employment Status Employed Retired Business Owner Employment Income Other Income (non-investment only) State of Residence Target Retirement Age Who Will Retire in What Order? Both Retire in Same Year Either can Retire First Employed Retired Business Owner You will Retire First Spouse will Retire First ASSETS YOU YOUR PARTNER LIABILITIES YOU YOUR PARTNER Real Estate (primary) Real Estate (rental, vacation) Vehicles (total) Cash on Hand and in Banks Roth and Traditional IRA Current 401(k), 403(b) Prior 401(k), 403(b) Investment Accounts Annuities (total cash value) Cash Value Life Insurance Other Assets Total Assets Real Estate Mortgage (primary) Mortgage Debt (other) Auto Loan(s) (total) Credit Card Debt Retirement Account Loan Margin Loan Loans on Life Insurance Other Debts Total Liabilities NET WORTH: Total Assets minus Total Liabilities: $ A check for you.

14 RETIREMENT ASSUMPTIONS YOU YOUR PARTNER Desired Monthly, After-Tax Retirement Income (in today s dollars) Do you want Social Security included as a retirement income source? o Yes o No o Not Eligible o Reduced % o Yes o No o Not Eligible o Reduced % Are you a participant in the Civil Service Retirement System or Railroad Retirement Plan? o Yes o No o Yes o No ANTICIPATED FUTURE INCOME: Some examples: inheritance, the sale of a business or deferred compensation. Description Amount Taxable Income Is This Income Recurring Start Year End Year Who s Income Is This? o Yes o No o Yes o No o You o Your Partner o Both o Yes o No o Yes o No o You o Your Partner o Both o Yes o No o Yes o No o You o Your Partner o Both o Yes o No o Yes o No o You o Your Partner o Both o Yes o No o Yes o No o You o Your Partner o Both NOTES: Securities and Investment Advisory Services offered through Voya Financial Advisors, Inc. member SIPC. Egan, Berger & Weiner, LLC is not a subsidiary of nor controlled by Voya Financial Advisors, Inc. A check for you Gallows Road, Suite 980 Vienna, Virginia (703)