Q. Robert, I am currently retired, but have not reviewed my accounts in years. One of my New Year’s Resolutions is to better manage my financial accounts. Where do I begin? – Samuel in Kernersville, NC
A. Samuel, it is important to review your accounts each year to make sure that your money is working for you. I would start by checking your account balance to see how much you have earned and how much you have paid in fees. It is good to know your numbers and to search for solutions if you are not satisfied with them. Secondly I would check to see if your beneficiaries are up to date. One thing that I encourage my clients to do is to make their banking accounts payable upon death, this process is very simple, but is often overlooked. By filling out a simple form at your bank you can list beneficiaries for your banking accounts; this will allow these funds to avoid probate. It is also a good idea to review your will and power of attorney so that you can make your final wishes known.
Q. Robert, one of my goals for 2017 is to retire, but I am concerned that I am not financially ready. When will I know that I am ready to take the plunge? Is there a specific dollar amount that I need for retirement? – Ricky in Kernersville, NC
A. Ricky, the answer is different for everyone. Here are three questions to consider before retiring:
- Are your debts paid off or nearly paid off?
- Is your savings great enough to cover your expenses (especially if you are not yet eligible to withdraw Social Security benefits)?
- Is your current strategy meeting your retirement goals and objectives, and can it withstand unexpected financial events?
If you are unsure about how to answer these questions, then I would recommend sitting down individually with your advisor to see if your current plan is retirement ready. It is best to have a clear plan and realistic expectations when entering into retirement.