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Thinking About Retirement? The Basics of Financial Literacy Are Your North Star

Thinking About Retirement? The Basics of Financial Literacy Are Your North Star Millstone Financial Group

Working towards retirement, you may have a detailed plan on how to manage your finances so that you have enough saved by the time you leave the workforce. With no external income coming in, there will be a new rulebook on how to manage your retirement earnings, expenses, and investments – not just so that you can keep growing your portfolio – but so you can live comfortably. Financial literacy in retirement is therefore crucial to achieving the retirement you dream of and can be understood through the following basics.

Earning

In retirement, you start to pay yourself with money you earned and have invested throughout your career. This money may come from employer-sponsored retirement accounts, individual retirement accounts, and Social Security. It’s essential to understand your sources of income, how much is in them, how much you’ll be getting from them, and the best times to access each. For example, you are eligible for Social Security from age 62, but experts suggest waiting until age 70 as benefits will be higher due to delayed monthly credits.[1]

The trick is that how much you choose to earn is up to you, but it is recommended that you shoot to earn 80% of your previous income[2] by utilizing multiple income sources. You should also look out for how this new income is taxed and how your sources of income are affected by unforeseen taxes in retirement. Overall, the timeline for when to utilize the different sources of income you have will require a comprehensive plan based on your financial situation, assets, and goals.

Spending

Believe it or not, spending wisely is the key to retirement longevity. Your spending is dependent on your lifestyle relative to your earnings. If you opt for a similar lifestyle to that of your workforce days, you can predict how much you’ll be spending in your day-to-day life. However, in retirement, there may be new additions like hobbies and habits that should be financed, big purchases like homes and cars, and major financial decisions like relocating or traveling regularly.

You may also have home mortgages and car loans to pay off or an obligation to financially support your kids’ and grandkids’ education. All these costs need to be factored in when thinking about spending. Then, the most under-planned costs in retirement are healthcare and long-term care. You can only receive Medicare from age 65, and that will not include long-term care. In addition, Part B, which covers your regular doctor visits, for example, is not free! Therefore, when thinking about expenses in retirement, it’s beneficial to prioritize your health and long-term care as early as possible.

Understanding earning and spending in retirement are the first steps to financial literacy, empowering you to take control of your future. To further gain insight into your finances in retirement, [sc name=”comp_review”] to sign up for a complimentary review with us at [sc name=”company_name”].

 

[1] https://www.ssa.gov/benefits/retirement/planner/applying2.html
[2] https://www.bankrate.com/retirement/how-to-manage-money-in-retirement/

Advisory services are offered through Millstone Financial Group Limited Liability Company, an Investment Advisor in the State of New Jersey. Insurance products and services are offered through Millstone Financial Group Limited Liability Company, an affiliated company.

Millstone Financial Group Limited Liability Company is not affiliated with or endorsed by the Social Security Administration or any other government agency. All content is for information purposes only. It is not intended to provide any tax or legal advice or provide the basis for any financial decisions. Millstone Financial Group Limited Liability Company does not offer tax planning or legal services but may provide references to tax services or legal providers. Millstone Financial Group Limited Liability Company may also work with your attorney or independent tax or legal counsel. Please consult a qualified professional for assistance with these matters.

**ALL INFORMATION INCLUDED HEREIN IS CONFIDENTIAL AND PROPRIETARY TO LONE BEACON. ALL ASSOCIATED CONTENT OR ANY PORTION THEREOF MAY NOT BE REPRODUCED OR USED IN ANY MANNER WHATSOEVER WITHOUT THE EXPRESS WRITTEN PERMISSION OF LONE BEACON**

**INFORMATION PROVIDED IS FROM SOURCES BELIEVED TO BE RELIABLE HOWEVER, WE CANNOT GUARANTEE OR REPRESENT THAT IT IS ACCURATE OR COMPLETE.  NO STATEMENTS MADE SHALL CONSTITUTE ANY FINANCIAL, TAX, LEGAL, OR ACCOUNTING ADVICE. ANY HYPERLINKS PROVIDED ARE AS A COURTESY AND SHOULD NOT BE DEEMED AN ENDORSEMENT**

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Donald Albach
Don has worked in the financial services industry for his entire professional career. Throughout every phase of Don’s career, he has focused on retirement planning. From implementing small to medium-sized company 401(k) Profit Sharing Plans to establishing an IRA for individual clients, Don has seen most aspects of the retirement planning process. Don’s role at Millstone Financial Group is to work with clients to create Retirement Income Planning strategies that help guide them towards financial peace of mind. Don graduated from Norwich University, “the nation’s oldest private military college,” in 1986. Upon graduation, Don went directly to work in New York City joining First Boston’s International Investment Group. From there Don moved on to MetLife where he spent the next 11 years working with employer group 401(k) plans. It was during this time that Don realized, while people were able to save for retirement, they had very little understanding of how to navigate through the complexities of retirement. In 2012 Don decided to separate from MetLife and established Millstone Financial Group. Don currently lives in Monroe Township, NJ with his wife, Tina, whom he has been married to since 1992. They have three children together, Paige, Donny, and Ally. Don’s two passions are sailing and watching college football. He also enjoys cooking Sunday dinner for his family.
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All content is for information purposes only. It is not intended to provide any tax or legal advice or provide the basis for any financial decisions. Nor is it intended to be a projection of current or future performance or indication or future results.

Opinions expressed herein are solely those of Millstone Financial Group and our editorial staff. The information contained in this material has been derived from sources believed to be reliable but is not guaranteed as to accuracy and completeness and does not purport to be a complete analysis of the materials discussed. All information and ideas should be discussed in detail with your individual adviser prior to implementation. Advisory services are offered through Millstone Financial Group Limited Liability Company dba Millstone Financial Group, an Investment Advisor in the State of New Jersey. Insurance products and services are offered through Millstone Financial Group Limited Liability Company. Millstone Financial Group Limited Liability Company is not affiliated with or endorsed by the Social Security Administration or any government agency. Being registered as an investment adviser does not imply a certain level of skill or training.

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