Transitioning into Retirement

Background

A couple spent years saving diligently and planning for an adventurous retirement. The wife worked as a management consultant, and the husband was a part-time college professor for the last 25 years. 

The couple decided to tackle the ins and outs of retirement planning. While doing so, they were overwhelmed with numerous decisions to make and had several concerns.


Challenges

The couple contacted Burney Wealth Management to get answers to their following questions: 

  1. What is the maximum amount they could spend each year without depleting their resources during their lifetimes? They were not concerned with leaving an inheritance to their kids.
  2. They wanted to downsize and move to a more retiree-friendly state, but they did not know how much they could afford and if they should buy the new home “mortgage-free.” 
  3. Since they relied on the wife’s health insurance coverage all these years, what was the best option for private health insurance, knowing they had three more years before Medicare age (65)?
  4. They had many different types of accounts (her 401(k), some old IRA’s, his Roth IRA, a large brokerage account, and a variable annuity) and didn’t know how to determine where to pull their monthly income from to pay their bills. 
  5. When should they take Social Security? 
  6. Finally, they’d been investing randomly in growth mutual funds for decades and accumulated a collection of individual stocks they bought over the years and wanted to know how their portfolio should be re-aligned to meet their retirement needs. 

How our financial advisors helped our clients to transition to retirement

Our retirement planning experts worked closely with the couple to create a game plan for their retirement by initiating the following action items with them: 

  1. We used our interactive tool—Decision Center—to help the clients quantify and visualize how much they could spend and the consequences of their retirement transition to a new state--including evaluating various mortgage financing options and comparing it to cash purchase.
  2. Educated them on their options for taking Social Security and their impact on their overall financial picture. 
  3. Walked the couple through their health insurance options with one of our insurance network experts and educated them on how being more tax-efficient with their portfolio could save thousands a year in insurance premiums before Medicare
  4. We consolidated their many investment accounts into three accounts, each with a unique purpose. We implemented an investment plan to maximize their long-term growth and improve diversification, including alternative investments they hadn’t considered.
  5. Created a plan to replicate a “monthly paycheck” by sending distributions directly from their investment accounts to their bank account each month, putting their annual spending on autopilot, and removing the need for them to make their withdrawals each month.

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