Retirement Elevated: A six-step guide to planning your future

MT Sean-P.-Lee-PhotoRegardless of age, retirement planning can be a daunting task. It can be difficult to identify where to begin, and once you do start, the process can quickly become overwhelming. Fortunately, there are steps that can be taken to not only help you begin your retirement planning, but carry that planning through to the development of a blueprint for your financial future. Consider these steps to get you started:

  1. Define your ideal retirement. Many pre-retirees fail to create a successful retirement plan because they skip this first and very crucial step. Identifying what “retiring well” means to you allows you to set goals and build a financial plan around your specific needs. For some, retiring well means volunteering and spending time with grandchildren, while for others it’s traveling the world and pursuing hobbies. Once you’ve identified your dreams and goals, you’re on your way to developing a successful retirement plan.
  1. Determine how much money you will need. Determining how much money you will need for your future can be one of the most overwhelming aspects of retirement planning. Calculating an exact number for your retirement funds can be complicated; however, coming up with an accurate estimate of your “number” can help reduce some of the uncertainty surrounding your retirement future. Start by identifying your fixed and planned expenses and factor in a buffer to allow for some flexibility.
  1. Invest for your future security. 401(k)s, 403(b)s, traditional and Roth IRAs may seem like alphabet soup to some, but these investment vehicles, along with traditional brokerage accounts, can play a crucial role in your financial security. Learning about these different options and understanding your risk tolerance for the different phases of your life can help tailor your investment strategy to meet your long-term goals. Market volatility can tempt many investors into making emotional decisions with their money, which can seriously hurt their nest egg over the long run. However, a proactive investment approach that coincides with your risk tolerance can not only reduce your stress when investing, but also give you the opportunity to let your money work for you.
  1. Minimize taxes on your retirement income. Many fail to realize that taxes can be one of the biggest expenses in retirement, but luckily there are several options and strategies available to help reduce your share going to Uncle Sam. As you save for retirement, consider tax-advantageous savings vehicles such as Roth IRAs or Roth 401(k)s—both can be great tools to provide future tax-free income in retirement. As you enter retirement, you may want to consider a rollover of your traditional savings accounts, but they’re not right for everyone. Working with the right financial professional can help you not only identify the tax-friendly ways to withdraw your retirement income, but also find the right balance of investments to minimize taxes on your income and avoid unnecessary fees and penalties.
  1. Insulate your wealth from the unexpected. Aside from taxes, the cost of medical expenses during retirement can be one of the most alarming figures to factor into your long-term plan. Understanding exactly how much health insurance you need for retirement can be difficult, but it’s crucial in order to prevent the devastating impact of inadequate coverage. Start by assessing your healthcare needs and researching the different options available through Medicare supplements and Advantage plans. It’s also smart to consider long-term care insurance and other alternatives so that you can make informed decisions.
  1. Protect your estate and provide for your heirs. Leaving behind a legacy is important for many retirees, and a well-developed estate plan can help you achieve that dream. For many, a trust is another important component for their estate. Consistently updating beneficiary forms is another crucial step to take to ensure your hard-earned assets are passed to the proper person(s). After a lifetime of planning and saving, you owe it to yourself and your family to make sure your final wishes are honored.

In my practice, I have identified these six steps to help create retirement plans for clients. While these are general guidelines, there are a lot of variables that can impact the planning of each step. I’d encourage all retirement planners to seek additional guidance before settling on one strategy. Attending a retirement planning class may be helpful. While there are a few options to consider, my firm teaches a two-day retirement planning course called Retirement Elevated. These courses are held at local universities in the Salt Lake area and can help provide the foundation you need to begin or advance your retirement plan. Depending on your situation, some may need further guidance and can benefit from one-on-one counsel with a financial advisor. Regardless, the most important takeaway is to plan now for your financial future and work that plan up to and through retirement.

Sean P. Lee, founder of Elevated Retirement Group, specializes in financial planning for retirement and assisting individuals with creating retirement income plans. For more information, visit