Financial Planning
Alamo Capital’s Financial Planning Program can provide you with a complete evaluation of your current financial condition using a comprehensive financial computerized program, generating results that will create a secure and solid financial plan. This plan will be a living model for financial decisions.
- Project and show income and expenses, now through life expectancy
- Estimate and calculate savings and investments, now through retirement
- Estimate Social Security and pension benefits
- Provide asset allocation advice with customizable portfolio sets
- Project inflation-adjusted needs during retirement
- Estimate tuition and housing for most major colleges
- Calculate savings levels that will properly meet education expenses
- Use flowcharts and clear calculations to quickly discuss estate issues
- Show the impact of establishing a credit shelter and life insurance trust
- Illustrate long term care needs and costs
Retirement Planning
However you define retirement for yourself, whether it be going back to school, pursuing creative passions or traveling the world, the bottom line is that you want to have enough money to live your life without constantly worrying that you’ll run out. It certainly pays to be prepared and to stay on plan. A successful retirement plan begins, of course, with making smart savings and investing decisions long before you contemplate retiring. But of equal or even greater importance is how you manage your money after you’ve left your primary career and begin to turn to your investments to provide the income that supports your lifestyle.
To enhance the chances that your savings will let you live comfortably in retirement, there are five primary areas of risk that need to be addressed:
- Timing and Withdrawals: The amount you withdraw from your retirement portfolio and when you do so are two of the main determinants of how long the portfolio will last. For example, taking large withdrawals during declining or bear markets makes it hard for a portfolio to recover and grow.
- Market Volatility: Related to the first risk, you need to position your portfolio to withstand inevitable swings in the market, and the way to do this is through diversification and asset allocation – holding a combination of stocks, bonds, cash and alternative investments that matches your risk profile. In retirement, you need diversification to perform a balancing act of having enough growth-oriented investments to help achieve acceptable long-term returns and bonds and other fixed income securities to provide steady income. Annuities could also make sense to provide at least a portion of your retirement income.
- Longevity: The good news is that you have a good chance of living to a ripe old age, but the risk here is essentially that you could outlive your assets. For a married couple who both reach age 65, there is more than a 60% chance that one of them will live to age 90. That means that if you retire at 65, you may need to plan for 25 years or more in retirement.
- Taxes and Inflation: A lot of people tend to underestimate the ability of inflation to destroy spending power. Over the past 25 years, during which inflation has been fairly tame, the Consumer Price Index (CPI) has more than doubled.
- Health Care Costs: The CPI is often not the most accurate measure of your personal inflation rate, since you may spend disproportionately on health care as you age. These costs have traditionally run at double or triple the overall rate of inflation and are not under control. In addition, consider long-term care insurance as a way to help pay for some of the potential nursing home costs as you get older.
Thanks to a combination of advances in medical technology and better lifestyle choices, Americans are living longer and more active lives. Enjoy your retirement years – however you decide to spend them. Spending some time with your Alamo Capital financial advisor today can help you enjoy true financial security tomorrow.