Fear can be a significant factor in the retirement planning process, hanging over every discussion you have about when you want to retire, what you want to do in retirement and how you’re going to pay for it all.
What people often lose sight of, however, is that they don’t have to iron out every detail of the next phase of life in a single session.
“It’s the ability to take small, manageable steps,” says Angela Anderson, a financial professional at AXA Advisors LLC. “Every person manages the process differently. Maybe you take a step back and focus on understanding how your pension works. Or you look at what’s involved in setting up an IRA. Find an advisor who will work with you and create a user-friendly process that moves at a pace you’re comfortable with, removing the fear.”
Smart Business spoke with Anderson about how to calculate your needs so you can plan to retire with the lifestyle you expect.
Where do you begin in planning your retirement?
Visualize an ideal day for you in retirement. What does that day look like? Let’s say you want to travel to Hawaii once a year. How much is that going to cost? If you haven’t thought about things in that much detail, consider more open-ended questions. Do you want to travel? Do you want to go back to work? Do you want to volunteer?
Start with broader questions and you can at least start to formulate a picture of what you want retirement to look like. Once you have that, you can begin thinking about how to make that happen.
The biggest thing is to not be scared of the process. Think of it like going to a doctor. You don’t expect the doctor to write you a prescription before an exam has been done. It’s a process of discussion and examination to figure out what you want and what you may need to do in order to get there.
How do you find an advisor you can trust?
Good retirement planning is always centered on the relationship. Sometimes a client won’t become a client for years. You become friends with an advisor through a business relationship, a networking opportunity or just by being involved in the community. You build trust with that person. And quite often, that trust leads to, ‘OK, let’s sit down and talk about what you do and plan for your future.’ It’s not a one- or two-year conversation. It can be three or four years, or more, of just having those conversations.
How does the retirement conversation differ for women?
There are generally three major obstacles facing women. The first is that women typically live longer than men and that places more strain on cash flow in instances in which they are living five, 10 or 15 years longer than their spouses. What about long-term care when your husband is gone and your children have moved away?
Second, some women just assume that their husbands will take care of everything to secure their futures. It’s important to take care of yourself as much as you take care of your household.
The third obstacle is divorce. Most women have benefits on their own record like Social Security or a pension. So it may not be a lack of financial resources, but a lack of responsibility to take those assets and learn to manage them when you’re living independently from a former spouse.
What’s the key to achieving your retirement goals?
The sooner you plan, the better it will be. It’s never too late to help make those long-term goals come true. But you need a plan just like anything else. There are a lot of things that pull on people and quite often, it’s a challenge to find the time to sit down and think about your retirement. Find an adviser you feel comfortable with and talk about those goals. And then find opportunities to knock out a few steps along the way and give yourself the time so you don’t have to rush the process.
Securities are offered through AXA Advisors, LLC (NY, NY 212-314-4600), member FINRA/SIPC. Insurance and annuity products are offered through AXA Network, LLC. AXA Advisors and AXA Network do not provide tax or legal advice. AGE 99808 (12/14)(Exp 12/16)
Insights Wealth Management is brought to you by AXA Advisors LLC
