If you want to diversify your retirement plan, but you're not sure where to start, take a look at these basic questions that can help get the conversation started with your financial professional.
Consider a Portfolio of Life
Taking a holistic look at your retirement plan is as much about your purpose in your life as it is about the products in your portfolio. One way to diversify your plan is to create a simple framework across four key areas: Health; Assets; lifestyle; Legacy.
Let’s take a look at some basic questions you could be asking about each of these key retirement categories. These questions can serve as great conversation starters with your financial professional.
Health – What are the different parts of prioritizing health?
- What do health concerns commonly (and realistically) look like as we age?
- What have your experiences been in the past — both good and bad?
- Do you have dependents who are impacted by their health situation (e.g., special needs children)? What do you think they will need?
- What does a healthy lifestyle look like in retirement?
- Most importantly, what is your plan for maintaining quality healthcare insurance in retirement?
Assets – What are the different tangible assets you would like to own in later life?
- What are your dreams in terms of a house, vacation home, classic car, boat, etc.?
- What are other assets that could fulfill the same need? Would an RV work, or does it really have to be a vacation home?
- What about the opposite: reducing assets later in life? What would you be happy to let go of to fulfill other priorities?
- Would you be comfortable downsizing your house to prioritize other lifestyle aspects later in life? If you have other assets you hope to trade in for other priorities, will those really appreciate in the way you expect? Ask your financial professional to share some high-level experiences from other retirees.
Lifestyle – What are your aspirations for lifestyle in retirement, and what are your basic needs? The reality may lie somewhere in between.
- What issues could emerge if you prioritize lifestyle early in retirement and then run out of income later?
- Or, alternatively, what if you are too frugal early in retirement and don’t enjoy your golden years as much as you could be?
- If necessary, what would you prioritize: week-to-week social life or big vacations? Time with family or time to pursue hobbies? All food for thought.
Legacy – How do you view legacy?
- Do you see legacy as a later-life consideration only?
- Or do you see legacy as something prioritized throughout life?
- Would you like to make investments in your grandchildren’s educations, in charities, churches and nonprofits? Or perhaps specific businesses, arts, and nonprofits?
- Ask your financial professional to share more specific examples of legacy, such as intended bequests: trusts, wills, and estate planning.
Asking the right questions on important topics is a great way to get the retirement planning process started and begin to see the big picture. While the dialogue will surely get much deeper with your financial professional, focusing on health, assets, lifestyle, and legacy can start and steer the conversation in the right direction.
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