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Retirement Strategies By: Ron Paquette. Overview Can you retire? Having a financial plan Investment...
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Transcript of Retirement Strategies By: Ron Paquette. Overview Can you retire? Having a financial plan Investment...
![Page 1: Retirement Strategies By: Ron Paquette. Overview Can you retire? Having a financial plan Investment strategies Avoiding pitfalls Helpful resources.](https://reader030.fdocuments.in/reader030/viewer/2022032521/56649d575503460f94a36807/html5/thumbnails/1.jpg)
Retirement Strategies
By: Ron Paquette
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Overview
• Can you retire? • Having a financial plan• Investment strategies• Avoiding pitfalls• Helpful resources
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Can you retire?
• Recessions (Bear Sterns, Lehman Bros, Merrill Lynch, GM, AIG, FNMA, stock market crash, housing crisis)
• Scandals (Bernie Madoff, Enron, Worldcom)• Globalization (decline in standard of living)• U.S. Deficit, bankrupt social security system• Health care needs of the boomer generation• World crises (terrorism, N.Korea, Iran)
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Financial Plan
• Financial goals• Starting early• Career planning• Money management / personal budgeting• Good credit• Insurance strategies• Investment strategies• Avoiding pitfalls
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Setting Financial Goals
• Desired lifestyle (dining, clothes, cars)• Travel, hobbies (golf, travel, RV)• Living accommodations• Geographic location• How much will you need?• What are your sources of cash flow?• What are your expenses?
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Starting Early
• More than half of Americans over 50 think their financials challenges are still ahead
• Social security isn’t going to cut it• Learn about investing early on
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Career Planning
• Exploring career options• Investing in education• Working in your “golden” years• Government v.s. private sector jobs• Self-employment
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Money Management
• Take advantage of 401k matches• Utilize retirement calculators (bankrate.com)• Stick to a budget• Rule of 72 (72/rate of interest = # of years to
double your money• Make wise consumption decisions• Maintain a good credit rating
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Insurance Strategies
• Health insurance• Long-term care• Fire• Auto• Life• Disability• Earthquake
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Investment Basics• Saving (cash)• Keeping pace with inflation (stocks)• Diversification (managing risk)– Cash & equiv., stocks, bonds, real estate, metals– Small cap, mid cap, large cap– Industry, geographic location, – Defensive v.s. Cyclical
• Mutual funds
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Investment Basics• Emergency fund (3 to 6 mos of living expenses)• What is your risk tolerance? (risk & reward)• Rate of Return = Return / Investment Amount• Compare return to benchmarks; indices• Assume less risk later in life & more early on
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Investment Strategies
• 401K, IRAs, pensions • Roth IRAs (will you earn more or less?)• Tax planning (municipal bonds, sale of a house)• Estate planning• Rebalance your portfolio – Marriage or divorce– Good or bad portfolio performance– Age– Inheritance, or change in income
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Investment Strategies, cont.
• Returns – 10.4% stocks, 5.4% govt bonds, 3.7% T-bills
• REITs
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Avoiding Pitfalls
• Find a certified financial planner• Watch out for hidden fees• Avoid borrowing from 401ks• Avoid credit cards & high interest rate loans• Watch out for variable loans• Don’t overspend or over leverage• Avoid junk bonds & penny stocks