Retirement planning is a marathon, not a sprint
Retirement planning is a marathon, not a sprint. Most people’s retirement planning goes like this: set retirement date, call to set up a time with a financial advisor to make plans and hope for the best. We believe the best time to start planning for retirement is long before you even consider planning an actual date for retirement. Forgive me for the oncoming sports and training parallels that you are about to receive. I am a triathlete who is training for my first full Ironman in September and frankly my thoughts are consumed by thinking about my training, planning and my eventual culmination of everything on race day. I have been thinking about the parallels we can glean from endurance training to help us have success with retirement planning.
Just like training for a long-distance event, retirement planning is all about the process leading you up to the big day. The only way you can have success is by following a plan and remaining consistent throughout. You can’t just do a couple of long workouts sporadically and expect to show up to the starting line in peak race condition. I like to think about it like making little deposits into my training bank every day over time. On race day, if I have built up my account right, I should have plenty to draw from to finish my event. The same goes for your retirement planning. You should try to start implementing your plan during your working years and stay consistent with it. Determining how much you should be saving, how your account should be invested, and how much money you will likely need in retirement are all crucial decisions that are best to be made earlier. Obviously, the data becomes finer tuned as you get closer to your date of retirement but having educated estimates will help your planning tremendously. We believe rather than “defaulting” into retirement it is better to make informed decisions consistently along the way.
If you want to reach your goals in the future, you may need to make some sacrifices to get there. The past ten months of training required me get really “creative” with my time management (hello 4:00 am workouts) but the end goal was worth the short-term sacrifice. The decisions you make 10, 20, and even 30 years before retirement can have a significant impact on your retirement lifestyle. Simple but purposeful adjustments along the way have the potential to mean big rewards when it comes to your retirement planning. This doesn’t mean you can’t have fun during your working years! It does mean that you should know what will be required for you to achieve what a successful retirement means to you. The worst time to find out you didn’t save enough, or invest your assets properly is when it’s too late to make effective changes.
Finally, know when it might be time to get that expert second opinion. I knew that if I wanted to achieve my goal of completing a full Ironman, I would need to hire a professional coach to help me design and implement my training plan. Just going through the motions of swimming, biking and running without purpose would not be enough. The same can be said of retirement planning. A professional can help you sort out both your short- and long-term goals and help you effectively plan. You will want to know how much you should be saving and that your accounts are allocated appropriately for your time horizon and risk profile. Fees also matter, so it is important to understand how much your investment accounts cost and if those fees are reasonable. Make sure the financial advisor you work with is a fiduciary. Fiduciaries have a legal and contractual obligation to put your best interests first.
Preparing for retirement may be a marathon, but it doesn’t have to be a completely painful process. By making the right decisions early and staying consistent you will set yourself up for financial success down the road at retirement. As always, if you have questions or would like to speak with us, we are always happy to help however we can. Stay well.
Ashley Rosser, President
Prior to her career in the financial services industry, Ashley earned her Bachelor of Science in Nursing from Cedarville University.
Ashley decided to make a career change from her ten years within the healthcare industry as a pediatric emergency room nurse to retirement and 401K investment planning. She joined Victory Fiduciary Consulting in 2008 after obtaining her Series 65 professional financial license and went on to earn her AIF (Accredited Investment Fiduciary) professional designation from the Center for Fiduciary Studies.