Retirement Planning For Individuals And Families

When construction contractors are ready to begin a project, they must start with a blueprint. If they were to simply take a pile of materials, tools, and supplies and begin placing them together haphazardly, the results would be undesirable. Rather than a home, office, or skyrise, they would have a worthless pile of wasted resources.

In a similar way, financial resources must be organized in a deliberate manner to allow someone to be able to build stable and robust retirement savings. Without a clear and direct plan, even a large supply of income can be squandered instead of utilized.

Sometimes it can be hard to know where to start when trying to build up retirement savings. Maybe you are  a financially well established small business owner or professional, but struggle to see how to develop the right habits that lead to success.

The overall retirement savings strategies for most people can be very similar, like opening an IRA or contributing as much as possible to your company 401(k). However, building a plan that works for you as an individual can vary widely depending on your personal and unique situation.

For example, if you are a single 30-something-year-old making six figures, you may be able to save aggressively. On the other hand, if you have a family of four living on $108,000 with two kids rapidly approaching college, you may need to keep your eyes on a few different priorities at once. 

In either case, the important thing is to have a plan, and that usually starts with a realistic budget. No matter how much money you earn, if you don’t deliberately tell it where to go, it’ll go wherever it wants to. Make saving for your retirement a priority in your budget at the beginning of the month, instead of waiting until the month is over to see what is left. Did you recently get a raise? Increase your 401k contribution before that new paycheck kicks in. You won’t even feel it, and you will be doing yourself a favor.

By developing a budget as a blueprint, you will know how to allocate your resources efficiently and effectively. This will free you to start building your retirement confidently.

Another important part of getting the ball rolling toward a secure retirement is to make sure you build on fundamentally sound principles. If you have sound investment principles, then they will guide you to good practices, and good practices lead to financial peace.

One important principle is to trust the market to do its job. It is tragic to witness someone trying to time the market and play the “buy low, sell high” game. Unfortunately, the financial media and Wall Street are fixated on this. Unless you have a time machine or a crystal ball to tell you the future, speculating about what the market will do is a foolhardy way to invest. Over the history of the market, it has had many rises and many falls, but over time the declines have proven to be temporary. The moral of the story is to trust the market and let time, not trends, be your ally to grow your investments. 

Another important principle to keep in mind is the age-old adage, “Don’t keep all your eggs in one basket.” Diversification is a critical element in risk management for investing. If you have all your funds in a single stock or even a single index fund, your investment portfolio  can be affected greatly by the decline of that one investment. If the company whose stock you own suddenly goes belly-up, so does your retirement plan.

Keep your resources in multiple parts of the market to reduce your risk.

There is obviously far too much to say about investing for retirement to cram into one blog article. But if you want to be ready for retirement when the time comes, you need to work with a solid plan now.

The best way to get a plan together that will help you get the best life possible with the money you have is to work with a Wealth Advisor who can help you through the process. With an objective ally in your corner, you will be better prepared to navigate retirement planning successfully.

To get started today, reach out to me at jeff.campbell@parkwoodswealth.com.

Jeff Campbell is a Wealth Advisor with Parkwoods Wealth Partners, a financial planning firm committed to providing services and advice that puts you, your family, and your values and goals first. With 25 years of experience in the financial industry, Jeff is passionate about building relationships with his clients, coaching them to make solid financial decisions and guiding them as they work toward the financial future of their dreams. He is known for being a good listener and providing clarity and confidence as he helps business owners secure their retirement and live their best life. Jeff has a bachelor’s degree in Economics from the University of Richmond. When he’s not working, Jeff loves spending time with his wife, Caitlin, his two children, Paige and Colin, and his extended family. He enjoys golfing, traveling, playing the guitar, and seeing live music. To learn more about Jeff, connect with him on LinkedIn.

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