INDUSTRY INSIGHT
YOUR FINANCES
SPONSORED CONTENT
Ensurning Financial Success in Retirement
Retirement should be one of the most enjoyable phases of life , characterized by freedom and leisure after years of hard work . However , achieving financial success during this period requires careful planning , discipline , and a proactive approach . Here are key strategies for ensuring financial security and prosperity in retirement .
1 . Start Planning Early
One of the most important steps towards a financially successful retirement is to start planning as early as possible . The earlier you begin saving for retirement ( although it ’ s never too late ), the more time your money has to grow due to compound interest . Aim to contribute consistently to retirement accounts , such as a 401 ( k ) or an IRA , taking full advantage of any employer match . Caviate : you will also want to invest outside of these plans ( after-tax ) so as not to have all your assets in one tax basket .
2 . Set Clear Retirement Goals
It ’ s essential to determine how you envision your retirement . Consider factors such as where you want to live , the lifestyle you desire , and any activities or hobbies you wish to pursue . Setting clear and realistic goals enables you to estimate how much money you will need in retirement , allowing you to create a tailored savings plan that aligns with your vision .
3 . Create a Budget
A comprehensive retirement budget is crucial for managing your expenses in this new phase of life . Take stock of your anticipated sources of income , including Social Security , pensions , and retirement account withdrawals . Next , outline your planned expenses , factoring in healthcare , housing , travel , and leisure activities . Keeping your spending in check ensures that your nest egg lasts through retirement .
4 . Understand Healthcare Costs
Healthcare can be one of the largest expenses during retirement . With age , the likelihood of needing medical care typically increases , making it essential to plan for these costs . Consider options such as Medicare , supplemental health insurance , and long-term care insurance . Researching and budgeting for healthcare will help you avoid unexpected financial burdens .
5 . Diversify Your Investments
Successful retirement planning includes a well-diversified investment portfolio . As you approach retirement , gradually shift your investment stategy to minimize risk while ensuring potential growth . This can include a mix of stocks , bonds , and other assets . Diversification helps protect your savings from market volatility and inflation , allowing your funds to provide income throughout your retirement years .
6 . Mirror a Paycheck When you retire , the goal is usually two-fold : first you want to be able to withdraw from your portfolio an amount sufficient to support your lifestyle and second you want to maintain your principal balance for some time . You have worked for many years to accumulate and to build an investment portfolio , now it is time for those investments to work for you . Establish a link between your investment account and your checking account and have the necessary funds transferred automatically each month in the same way you had your paycheck automatically deposited into your checking account .
7 . Diversify Tax-wise Any withdrawals you take from pre-tax , tax-deferred retirement accounts ( qualified plans ) are 100 % taxable . You will want to withdraw from those plans prior to having to take a required minimum distribution ( RMD ) or you might be forced to pay higher taxes later . Note : under current tax law depending on your age , you may not be required to take an RMD until age 75 . With that said , if you have other after-tax accounts to draw from when you retire , you can limit the withdrawals from your qualified accounts and remain in a low tax bracket . The key point here is you may want to diversify your investment nest egg tax-wise as you move toward retirement to provide you with maximum tax-planning flexibility .
9 . Seek Professional Guidance
If you ’ re unsure about your retirement strategy , consider consulting a certified financial planner ( CFP ). A CFP professional can provide personalized guidance based on your unique circumstances , helping you develop a comprehensive plan that aligns with your goals . Their expertise can be invaluable in making informed decisions that lead to financial success .
Being financially successful in retirement is attainable with thoughtful planning and disciplined execution . By starting early , setting clear goals , creating a budget , understanding healthcare costs , diversifying investments , planning for withdrawals , staying informed , and seeking professional guidance , you can secure a comfortable and fulfilling retirement . Ultimately , the key to enjoying this well-deserved phase of life lies in preparation , allowing you to embrace the future with confidence and peace of mind .
This Industry Insight was written by Garrett S . Hoge , CFP ®, ChFC ®, MS .
H Financial Management , is a private wealth manager based in Southpointe serving the ever-changing financial needs of his clients . Please contact Garrett at H Financial Management , 400 Southpointe Blvd ., # 420 , Canonsburg , PA 15317 , Phone : 724.745.9406 , Email : garrett @ hfinancial . net , or via the Web : hfinancialmanagement . com .
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H Financial Management is not affiliated with Osaic Wealth , Inc .
PETERS TOWNSHIP | FEBRUARY / MARCH 2025 31