Many clients who come to Wood Smith Advisors for financial guidance have one pressing question on their minds:

Am I financially “okay” to retire?

Most people think of their 401(k) (or other workplace retirement plan) when they think of retirement savings. However, there are several other options for growing your retirement savings in a tax-efficient way. Today I’d like to go over two savings vehicles you may not be leveraging yet - your HSA, and a Backdoor Roth IRA. 

The 2017 Tax Cuts and Jobs Act (TCJA) changed several tax laws. These changes make tax planning an even more critical part of your comprehensive financial plan. 

One of the changes that require more forward-thinking than before is that Roth Conversions are now permanent, not reversible as they have been in years past. Let’s talk about what a Roth Conversion is, and whether or not you should leverage this strategy before the December 31st deadline this year.  

When you’re growing your career, and you start to bring in a higher salary, your bigger paychecks often come with mixed emotions. Earning more money for yourself and your family is a fantastic feeling, but the additional considerations that come with higher wealth can be overwhelming.

Many companies who have formerly offered a pension are now “buying out” plan participants. General Electric is the most recent company to enact a pension freeze and to offer a buyout to all 100,000+ of their current pension benefit recipients. Fewer and fewer organizations now offer a pension to their employees for a variety of reasons. In their place, a 401(k), 403(b), or other employee-funded retirement savings vehicle is usually offered instead. 

The idea of early retirement appeals to many people - and why wouldn’t it? When you’ve spent so much time and energy planning for your ideal retirement, it’s completely reasonable to be excited to dive in. However, early retirement doesn’t come without its drawbacks. It’s important to know what you’re walking into before taking the leap.

Too often, people view charitable giving and building a legacy as something they do exclusively through their estate plan. Apart from small donations to their favorite charity or religious organization each year, they don’t work to align their financial budget with their values, or the causes they care about. 

Caring for aging parents is an incredibly challenging and emotional task, especially as they near the end of their lives. As an adult child, there are several ways you can help your parents through this next chapter gracefully by guiding them through both financial and emotional decisions. 

Have you ever considered volunteer work in retirement? Whether you’re planning to take a full-blown volunteer vacation as a retiree, or you want to help at your local animal shelter weekly, incorporating volunteering into your schedule as a retiree has a wide range of benefits. From improving your physical and emotional health, to finding a connection in your community, to making an impact on the world around you - volunteer work is a fantastic lifestyle pursuit for retirees.

When people picture retirement, many of them picture a retired couple enjoying their days in the Arizona sun, or camped out at their beach house by the ocean. The stereotypes of snowbirds, or of retirees uprooting their lives to relocate somewhere warmer, exist for a reason. Close to 25% of retirees are looking to leave their current community for one reason or another, with the vast majority of retirees moving to sunnier states like New Mexico, Florida, and Arizona.

Long-term care insurance is specifically intended to help policyholders cover the cost and expenses of long-term care. Typically, these are services that go above and beyond what traditional health insurance covers. 

Retirement can often be a challenging time. Putting financial concerns aside, the transition from working full time and being committed to consistent goals to having no defined structure to your day-to-day can be challenging. One way that some retirees, and senior citizens who are still employed full time, are finding purpose, fulfillment, and joy in this new season of life is by attending college or continuing education courses through a waived tuition program at a local college or university. 

Setting financial goals isn’t always the most challenging part of building a financial plan. Too often, individuals have a laundry list of goals - and as they move through life, that list grows. However, when it’s time to organize a strategy for pursuing those goals, things get a little bit more difficult. 

When you’re not sure how to prioritize your financial goals, you tend to try and knock them out all at once. Trying to funnel your limited cash flow to multiple goals simultaneously isn’t always effective - especially when done without a strategy. 

If you’re gearing up for retirement, it’s important to build a road map for your lifestyle and finances during this new chapter. Too often, people jump into retirement with a loose plan for their money and assume that it will sustain them throughout their years as a retiree. 

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