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Presented by MidAmerica Financial Resources. You can reach them at 618.548.4777 or greg.malan@lpl.com or on the web at www.mid-america.us

 

Your Financial Co-Pilot

Your Financial Co-Pilot

If anything happens to you, your family has someone to consult.

Provided by MidAmerica Financial Resources

 

If you weren’t around, what would happen to your investments? In many families, one person handles investment decisions, and spouses or children have little comprehension of what happens each week, month, or year with a portfolio.

 

In an emergency, this lack of knowledge can become financially paralyzing. Just as small business owners risk problems by “keeping it all in their heads,” families risk problems when only one person understands investments.

 

A trusted relationship with a financial professional can be so vital. If the primary individual handling investment and portfolio management responsibilities in a family passes away, the family has a professional to consult – not a stranger they have to explain their priorities to at length, but someone who has built a bond with mom or dad and perhaps their adult children.   

 

You want a professional who has to meet a fiduciary standard. Look for a financial professional who upholds a fiduciary standard. Professionals who build their businesses on a fiduciary standard tend to work on a fee basis or entirely for fees. Other financial services industry professionals may earn much of their compensation from commissions linked to trades or product sales.1

 

Commission-based financial professionals don’t necessarily have to abide by a fiduciary standard. Sometimes, only a suitability standard must be met. The difference may seem minor, but it really isn’t. The suitability standard, which hails back to the days of cold-calling stock brokers, dictates that you should recommend investments that are “suitable” to a client.  In contrast, a financial professional working by a fiduciary standard always has an ethical requirement to act in a client’s best interest and to recommend investments or products that clearly correspond to that best interest. The client comes first.1

 

You want a professional who looks out for you. Financial professionals earn trust through their character, ability, and candor. In handling portfolios for myriad clients, they learn to watch for certain concerns and to be aware of certain issues that may get in the way of wealth building or wealth retention.

 

Many investors have built impressive and varied portfolios, but lack long-term wealth management strategies. Money has been made, but little attention may have been given to tax efficiency or risk exposure.

 

As you near retirement age, playing defense becomes more and more important. A trusted financial professional could help you determine a risk and tax management approach with the potential to preserve your portfolio assets and your estate.

 

Your family will want nothing less. With a skilled financial professional around to act as a “co-pilot” for your portfolio, your loved ones will have someone to contact should the unexpected happen. When you have a professional who can step up for you today and tomorrow, you have a financial professional whose service and guidance can potentially add value to your financial life.

 

If you’re the family member in charge of investments and crucial financial matters, don’t let that knowledge disappear at your passing. A will or a trust can transfer assets, but not the acumen by which they have been accumulated. A relationship with a trusted financial professional may help to convey it to others.

MidAmerica Financial Resources may be reached at 618.548.4777 or greg.malan@lpl.com www.mid-america.us

 

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

Securities and advisory services offered through LPL Financial, a Registered Investment Adviser, Member FINRA/SIPC.
MidAmerica Financial Resources and Malan Financial Group are separate and unrelated companies to LPL.

Citations.

1 – kiplinger.com/article/retirement/T023-C032-S014-choosing-a-financial-adviser-fiduciary-dimension.html [3/22/19]

The Retirement We Imagine, the Retirement We Live

The Retirement We Imagine, the Retirement We Live

Examining the potential differences between assumption and reality. 

Provided by MidAmerica Financial Resources

 

Financially speaking, retirement might differ from your expectations. Just as few weathercasters can accurately predict a month’s worth of temperatures and storms, few retirees find their financial futures playing out as precisely as they assumed. Because of this, some common financial assumptions (and anxieties) about retirement are worth examining.

 

Few retirees actually “outlive” their money. Generations ago, many older people did live in dire straits, sometimes “down to their last dime.” Social Security was created to help them. Today, Social Security is still around, and many retirees are smart about their savings and income: they avoid reckless spending, and if they need to live on less at a certain point, they do. Health crises can and do impoverish retirees and leave them dependent on Medicaid, but that tends to occur toward the very end of retirement rather than the start.

 

The amount you withdraw annually from your retirement savings may vary. Anything from health care expenses to a dream vacation to a new entrepreneurial venture could affect it. So could the performance of the financial markets.

 

Retiring on 70-80% of your end salary may not be feasible. Some articles state that new retirees should strive for that goal, but it can be tough to achieve.

 

In the initial phase of retirement, you will probably want to travel, explore new pursuits and hobbies, and get around to some things you have put on the back burner. So, in the first few years away from work, you could spend roughly as much as you did before you retired or potentially more.

 

JPMorgan Asset Management recently analyzed spending patterns of more than 5 million U.S. households, reviewing figures from the Bureau of Labor Statistics, the Employee Benefit Research Institute (EBRI), Chase, and other sources. It found that median household spending increases on the way to a retirement transition: it usually begins to rise 1-2 years before a retirement date, and it generally takes 1-2 years to return to the old pre-retirement levels. The same study noted that median annual household spending in retirement declines gradually after age 60 and begins to plateau when people reach their early eighties.1

 

Another interesting finding from the JPMorgan analysis: while 56% of households headed by people in their sixties saw a fluctuation in spending at retirement, 38% of those households saw spending decline, either in the short term or the long term.1

   

In fact, once you are retired for a while, you may spend less than you anticipate. Analyzing Bureau of Labor Statistics data, personal finance website SmartAsset says that on average, households headed by those older than 65 spend 25% less annually than younger households (a difference of more than $15,000). While health care spending increases in retirement, other household costs decline, particularly transportation and housing expenses.2

 

You could retire before you think you will. Most people retire closer to age 60 than age 70: according to Gallup, the average retirement age in this country is 61. You could find yourself claiming Social Security earlier than you planned, if only to avert drawing down your retirement savings too quickly.3

 

You may be surprised at your quality of life. Colloquially speaking, American retirees seem to have it pretty good. ING, the global banking giant, surveyed retirees in 15 countries on both sides of the Atlantic and asked them if they agreed with the following statement: “In retirement, my income and financial position let me enjoy the same standard of living that I had when working.” Forty-seven percent of American retirees indicated that was true for them, compared to 14% in France and 26% in Germany.4

 

Your retirement may differ slightly or even greatly from the retirement you have imagined. Fortunately, it may be possible to adjust both your retirement plan and your retirement income strategy in response.

 

MidAmerica Financial Resources may be reached at 618.548.4777 or greg.malan@lpl.com www.mid-america.us

 

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

Securities and advisory services offered through LPL Financial, a Registered Investment Adviser, Member FINRA/SIPC.
MidAmerica Financial Resources and Malan Financial Group are separate and unrelated companies to LPL.

Citations.

1 – am.jpmorgan.com/us/en/asset-management/gim/adv/insights/three-retirement-spending-surprises [1/21/19]

2 – tinyurl.com/yy2pojuc [4/26/18]

3 – news.gallup.com/poll/234302/snapshot-americans-project-average-retirement-age.aspx [5/10/18]

4 – forbes.com/sites/andrewbiggs/2019/03/15/u-s-retirement-system-rocks-europe [3/15/19]

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