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5 Reasons Why Pre-Retirees May Need a Financial Advisor

September 21, 2022 by Bautis Financial
Retirement Help | Financial Advisors Help With Retirement

Successful retirement planning is one of the most difficult tasks, as it requires savvy money management. Here’s how a financial advisor can help alleviate the stress while ensuring you don’t run out of money in retirement.

The Anytime Estimate Retirement Finances Survey found that, across all age groups, the median amount Americans have saved for retirement is $71,500. 27% of those surveyed have less than $50,000 in retirement savings, and 16% have nothing saved.

While the amount you need to save for retirement varies by individual, saving for retirement is easier the sooner you get started, and a financial advisor can help you formulate a plan.

Even those who are five years or less away from retirement, it’s not too late to make adjustments to your retirement plan. If you have questions around the following five topics, you may want to seek out professional advice.

Related: Do You Think You Need a Financial Advisor? Start Here

How to Get An Accurate Projection of Your Retirement Income

There are very few things more frightening than the thought of outliving your resources in retirement. Even a seemingly adequate plan can be inadequate for your needs if not managed properly, especially as market conditions change. Financial advisors can help you project how much money you’ll need to meet your retirement goals all while figuring out the impact of taxes, inflation and health care expenses in the next phase of life.

When is the Optimal Time to Collect Social Security?

While you can start receiving Social Security retirement benefits at age 62, it doesn’t necessarily mean that’s the optimal course of action for all retirees. 

If you delay your benefits until after full retirement age, you will be eligible for delayed retirement credits that would increase your monthly benefit. The opposite is true for taking your benefit before 62: If you start receiving benefits early, your benefits are reduced a small percent for each month before your full retirement age.

A financial advisor can help you coordinate Social Security with your overall retirement income plan.

Related: ​​Savvy Social Security Planning: What Baby Boomers Need to Know About Their Retirement Income

How to Determine the Best Retirement Withdrawal Strategy

When the time comes to tap into the various savings and investment accounts you’ve built up, it’s important to take factors such as life expectancy, taxes and additional income sources into consideration. A financial advisor can create a distribution optimization strategy for all four phases of retirement.

This strategy can influence your savings, so the earlier you plan, the more flexibility you’ll have during retirement.

Related: How Tax Planning Changes Through the Four Stages of Retirement

How to Plan for the Possibility of Long-Term Care in Retirement

According to the Administration for Community Living (ACL), someone turning 65 this year has almost a 70% chance of needing some type of long-term care services or support in their remaining years. For that reason, a holistic retirement plan takes long-term care into account. 

A long-term care plan should provide financial coverage in case of disability, special needs or the death of a spouse. Funding a long-term care plan can be challenging, but there are options like long-term care insurance or health savings accounts (HSA), which a financial advisor can walk you through. 

Related: How to Start a Family Caregiving Discussion

How to Construct a Proper Estate Plan

Estate planning is important for everyone, no matter age, wealth or health. But if you don’t already have the 6 must-have estate planning elements in place, you should by the time you reach retirement age. Not only can a financial advisor ​​help curate a well-established estate plan, they can coordinate with other professionals, like an Estate Planning Attorney.

Financial advisors can offer even more suggestions for pre-retirees, and they can widely vary depending on the individual. Even if you’re close to (or already in) retirement, a financial advisor may be able to suggest better ways to manage your income and investments as well as avoid unnecessary taxes. 

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Category: Personal Finance, Retirement Planning, Wealth ManagementTag: Pre-Retirement, Retirement Help, Retirement Planning
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