Goals and Retirement. Where do you start? How do you plan for retirement when there are a lot of unknowns? For example, you currently have an investment strategy, but there are also liabilities such as what your future spending is going to be and how long you’re going to live. In addition, there are also health costs to take into consideration and whether or not you want to leave assets to your heirs. When it comes to goal setting and retirement, where do you start? It all starts with determining your priorities.
Start with the necessities: No matter what type of retirement life you want to live, there are a few certainties. You need money to cover housing, to eat, and to cover your health bills. Necessities should be your number one retirement priority as if funds aren’t in place to cover the daily costs of living, it’s hard to move on to other goals.
Need Goals vs. Want Goals
Next, move on to 2 different types of priorities: the priorities you need, vs. the priorities you want. Your need goals are the things that you can’t go without. For example, covering final expenses would be a need goal, while purchasing a second home to vacation at would be a wanted goal. It’s very easy to make two columns on a piece of paper and list your priorities into these two categories.
Next, go with your most important want goals – this may be different for everyone. Your biggest goal may be to amass enough wealth to leave a large legacy to your children or grandchildren or you may want to have enough funds to travel wherever you want to go when you want to go.
When developing retirement goals and strategies, prioritize your necessities and need goals first. Once you have a strategy in place to help you reach those goals, you can then move on to other priorities such as your want goals.
The reason it’s important to break things down into various priorities is that it can help you determine the cost of each priority. Also, it’s easier to focus on one goal at a time, rather than trying to come up with an investment strategy that covers a lot of the unknowns that are harder to plan for.
Retirement planning isn’t a one step process and therefore, goal setting for retirement shouldn’t be a one step process either. By breaking things into smaller pieces, it’s easier to visualise your goals and what steps you can take to reach them.
We are here to help. Contact a Paradise Financial Group retirement specialist today.