{"id":3486,"date":"2020-02-26T06:00:34","date_gmt":"2020-02-26T06:00:34","guid":{"rendered":"http:\/\/springwaterwealth.com\/?p=3486"},"modified":"2020-08-09T22:06:01","modified_gmt":"2020-08-10T05:06:01","slug":"women-planning-for-retirement-why-you-need-an-effective-financial-plan-in-place","status":"publish","type":"post","link":"https:\/\/springwaterwealth.com\/women-planning-for-retirement-why-you-need-an-effective-financial-plan-in-place\/","title":{"rendered":"Women Planning for Retirement: Why You Need an Effective Financial Plan in Place"},"content":{"rendered":"<p>As a woman, you\u2019ll almost certainly be completely responsible for your finances at some point in your life.\u00a0 It may be because you choose not to marry, or because you marry but later get divorced.\u00a0 Or it may be because you\u2019re married, but at some stage will be widowed \u2013 after all, women on average live five years longer than men.\u00a0 For this reason, it\u2019s critical that as a woman you\u2019re involved in the <a href=\"http:\/\/springwaterwealth.com\/the-independent-womans-guide-to-planning-for-retirement\/\" target=\"_blank\" rel=\"noopener sponsored noreferrer\"><strong>planning for your retirement<\/strong><\/a>.\u00a0 And retirement planning is an essential component of a robust financial plan.\u00a0 Here\u2019s why you need an effective financial plan in place.<\/p>\n<h2>What a Financial Plan Does<\/h2>\n<p>If you imagine your life as a journey, then you might think of a financial plan as a roadmap \u2013 or, if you\u2019re a sailor, as a course to plot \u2013 designed to get you from where you are today to where you want to be in the future.<\/p>\n<h2>What a Financial Plan Includes<\/h2>\n<p>A robust financial plan will address all of the following areas of your financial life:<\/p>\n<ul>\n<li>Cashflow planning<\/li>\n<li>Risk management and insurance<\/li>\n<li>Investment management<\/li>\n<li>Retirement planning<\/li>\n<li>Tax planning<\/li>\n<li>Estate planning<\/li>\n<\/ul>\n<h2>Why You Need an Effective Financial Plan<\/h2>\n<h3>Visualize What\u2019s Important to You<\/h3>\n<p>An effective financial plan will help you define and prioritize what\u2019s important to you.\u00a0 Naturally, income in retirement is a top priority.\u00a0 But there are also things you\u2019ll need to spend money on, like health care (which tends to increase in price more than other goods and services), periodic home maintenance and upgrades, replacement cars and, potentially, care at home or in a facility later in life.\u00a0 And you\u2019ll definitely have things that you may want to spend money on, too \u2013 like travel, education and support for your kids or grandkids, and charitable giving and philanthropy.<\/p>\n<p>Once you\u2019ve defined and prioritized your goals, you and your financial planner can start to figure out how to pay for them.<\/p>\n<h2><strong><span style=\"color: #00bbff;\"><a style=\"color: #00bbff;\" href=\"http:\/\/springwaterwealth.com\/contact-us\/\" target=\"_blank\" rel=\"noopener noreferrer\">Want to learn more about retirement planning? Contact our team at Springwater Wealth today to learn how we can help you develop a plan for your financial future.<\/a><\/span><\/strong><\/h2>\n<p>&nbsp;<\/p>\n<h3>How Much Do I Need to Save?<\/h3>\n<p>When you retire, you\u2019ll most likely be able to claim a Social Security benefit.\u00a0 If you\u2019re married, your benefit will be the larger of your own and one-half of your spouse\u2019s.\u00a0 If you\u2019re divorced, your ability to claim a <strong><a href=\"http:\/\/springwaterwealth.com\/divorce-and-your-social-security-benefits\/\" target=\"_blank\" rel=\"noopener noreferrer\">divorced spouse\u2019s benefit<\/a><\/strong> will depend on how long your marriage lasted and whether you\u2019ve remarried.\u00a0 And if you\u2019re widowed, you\u2019re entitled to claim a <strong><a href=\"http:\/\/springwaterwealth.com\/with-social-security-dont-confuse-spousal-and-survivor-benefits\/\" target=\"_blank\" rel=\"noopener noreferrer\">survivor benefit<\/a><\/strong> \u2013 up to 100% of what your deceased spouse or deceased ex-spouse collected or was entitled to collect at the time of their death.<\/p>\n<p>But, if you\u2019re like most women, a Social Security benefit alone won\u2019t be enough to meet your income need in retirement, and so you\u2019ll need to accumulate savings in retirement and investment accounts, like a 401(k) or <strong><a href=\"https:\/\/www.investopedia.com\/terms\/1\/403bplan.asp\" target=\"_blank\" rel=\"noopener noreferrer\">403(b) plan<\/a><\/strong>, a traditional or Roth IRA, and a taxable brokerage account.\u00a0 Employer-sponsored retirement plans like 401(k)s often include incentives to participate, like employer matching contributions, so you\u2019ll want to make sure you take advantage of these, if they\u2019re available to you.<\/p>\n<p>In preparing an effective financial plan for your retirement, you and your financial planner will use some fairly sophisticated software that will help you determine how much you\u2019ll need to save in these different types of accounts, so that you build an adequate nest egg.<\/p>\n<h3>How Should I Invest?<\/h3>\n<p>You might think of your portfolio as the engine for your plan.\u00a0 Its performance fuels the growth of your investments over time.<\/p>\n<p>Many people think that the key to investing success is buying \u201chot\u201d stocks \u2013 like finding the next Microsoft or Google, or \u201ctiming\u201d the market \u2013 knowing when to buy and sell ahead of a market rise or fall.\u00a0 If this sounds a lot like looking into a very cloudy crystal ball, it is \u2013 and the <strong><a href=\"https:\/\/us.spindices.com\/spiva\/#\/about\" target=\"_blank\" rel=\"noopener noreferrer\">dismal track record<\/a><\/strong> of investors who try to beat the market with these strategies should be all the proof you need that it\u2019s the wrong approach.<\/p>\n<p>At Springwater, we know the factors that will largely determine the performance of your portfolio \u2013 and they\u2019re things that a disciplined, professional advisor can help you control, like asset allocation (your \u201cmix\u201d of investments), diversification (owning a variety of investments that perform differently over time), taxes and fees, and, perhaps most importantly, your emotions.<\/p>\n<p>Your investment strategy should be designed to take as little risk as possible, while still helping you achieve your goals.<\/p>\n<h3>What Can Go Wrong?<\/h3>\n<p>To paraphrase the Scottish poet Robert Burns, \u201c\u2026even the best-laid plans\u2026 [can] go awry\u201d.\u00a0 As a woman planning for retirement, you\u2019ll want to be sure that your financial plan takes into account things that could potentially jeopardize your financial journey.\u00a0 Together with your financial planner, you\u2019ll want to assess the potential impact of things like lower investment returns, higher taxes, reduced Social Security benefits and, perhaps most importantly, longevity.\u00a0 Living longer than planned simply means that you\u2019ll need even more resources to provide the income you need.<\/p>\n<h3>Peace of Mind<\/h3>\n<p>Let\u2019s bring full circle the sailing analogy that we started with, and imagine that you\u2019ve decided to sail from the San Francisco bay to Hawaii.\u00a0 Your boat is fairly new and well-maintained, you\u2019ve got the latest navigational and safety gear, and you\u2019ve wisely decided to bring along a co-pilot (your financial advisor).<\/p>\n<p>From all of your research, and from conversations with sailors who\u2019ve made the trans-Pacific journey before, you know that you\u2019re bound to encounter some storms along the way.\u00a0 You\u2019ll also benefit from tailwinds at times.\u00a0 And you may encounter the occasional lull, when nothing seems to be working, and little or no progress is being made.<\/p>\n<p>But you take comfort from the fact that you have a well-thought-out plan, one that takes into account the challenges you\u2019ll face along the way.\u00a0 And while the conditions may push you slightly off-course now and again, by making periodic incremental course corrections you can stay on track.\u00a0 \u00a0Knowing you\u2019ve given yourself the best possible chance of reaching your destination safely and securely provides tremendous peace of mind.<\/p>\n<p>As a woman planning for retirement, having an effective financial plan in place can help you make smart decisions that will protect your future, while balancing your lifestyle with supporting family, friends or causes you care about.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>As a woman, you\u2019ll almost certainly be completely responsible for your finances at some point in your life.\u00a0 It may be because you choose not to marry, or because you marry but later get divorced.\u00a0 Or it may be because you\u2019re married, but at some stage will be widowed \u2013 after all, women on average 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