holistic financial planning PAX Financial Group

Holistic Financial Planning: 10 Things to Consider Before Retiring

holistic financial planning, retirement, PIVOT May 14th, 2018 by: Darryl Lyons

What is holistic financial planning? It’s an approach to financial planning that takes an investor’s specific situation into consideration when making decisions about their finances. Instead of focusing solely on what the market is doing, this approach examines an investor’s life and goals and creates a plan to fit that situation.

Here at PAX Financial Group, we offer that approach. It’s important to us that your plan fits with what your dreams of retirement look like. When the time comes to retire, or to PIVOT, as I like to say, leaving your working years behind you and PIVOT-ing into a new chapter in life, we want to make sure you’re truly ready.

We call those in this situation preparers or pre-PIVOTers.

If you are a pre-PIVOTer, here are 10 things you should consider doing before you take the leap into retirement:

  1. Identify other ways to earn money.
  2. Rebalance your investments.
  3. Establish tax diversification.
  4. Develop a mature buying approach that avoids “shiny” things.
  5. Consider purchasing an annuity.
  6. Establish a long-term-care plan.
  7. Seek marital counseling.
  8. Identify the frequency of reviewing investments.
  9. Have a family meeting about parents’ care.
  10. Consider when to officially retire.

I believe that the key to a successful retirement is preparation. If you don’t prepare well, peer pressure, reaction and con-artists will tell you how to spend your retirement money.

When a family takes time to carefully evaluate their plan, their risks and their opportunities, they can “chillax.” They make it possible to watch the sunrise and sip a cup of coffee without anxiety. Those who don’t plan well may drink that cup of coffee with the noise of the market in the background. They may wake up to daily anxiety.

 

To prepare yourself for your retirement years, consider this:

 

1. Pay off consumer debt.

Not only will you get rid of interest and payments, but you will reduce the stress associated with pesky payments.

 

2. Pay off your mortgage.

If this requires you to downsize or move, you may want to make that happen. Really try to get your mortgage balance to zero.

 

3. Practice living on your PIVOT retirement budget.

This is important. Separate your cash flow into two groups: Needs and wants. Then monitor your spending in each category.

 

4. Account for replacement expenses.

Start to identify how frequently you will need to upgrade vehicles. When do you suppose you will need a new roof? When accounting for replacement expenses, either set aside the money each month or plan on making a major withdrawal from your investments in the future.

 

5. Evaluate pension options and survivorship options.

Consider establishing a pension maximization plan. This means that instead of getting a 75 percent survivorship option on your pension, elect to buy life insurance instead. This isn’t always the right way to go, but if you don’t run the math early, a door of choice will close.

 

6. Identify a list of activities and start practicing.

If you are married, align interests and plan things to accomplish. Will you be active or quiet? Will you do ministry work or start a business? The possibilities are endless.

 

7. Determine a giving strategy.

Do you plan to give to charity? Will you be able to? Look into this early.

 

8. Practice risk.

When you have more free time, you will study your investments more closely. Statement anxiety only rewards you with high blood pressure. PAX Financial Group helps our clients establish their tolerance for investment volatility. Tolerance takes effort and practice. Be sure to clearly define what “risk” means to you.

 

Have questions about how to professionally notify human resources about your upcoming retirement? Download our free bonus chapter on how to tell your boss that the time to PIVOT is now.  

 

According to the Department of Labor, the average American spends roughly 20 years in retirement. With that much life in retirement, make sure you PIVOT the right way. Ask yourself: What if we live longer than we expect? What would happen if inflation occurs? How would we handle a big health care expense? Discuss the odds and the impact.

As you can see, retirement talk involves much more than money. Why? Two major threats to money are longevity and health. What impacts longevity and health? Many factors, including lifestyle, community and purpose. For us to be successful in our PIVOT, we need to take the retirement conversation beyond investments and strategy. And that’s why we practice holistic financial planning. Every situation is different. And everyone’s plans and dreams are different. There’s no one-size-fits-all retirement strategy. Knowing an investor’s particular plans after working is an important factor in creating a financial planning strategy.

Here are a few things we consider in this holistic financial planning approach:

  • Take inventory of your past.
  • Identify your gifts.
  • Share with others.

Are you a pre-PIVOTer? Contact us and let us help you plan for the future you want.

 

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This material is provided by PAX Financial Group, LLC. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. The information herein has been derived from sources believed to be accurate. Please note: Investing involves risk, and past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs and expenses, and cannot be invested into directly. All economic and performance data is historical and not indicative of future results. Diversification cannot ensure a profit against loss in a declining market. It is a strategy used to help mitigate exposure to risk.

Darryl Lyons

Darryl Lyons

CEO and co-founder of the PAX Financial Group, Darryl Lyons has been a licensed professional in the financial services industry since 1999. A lifelong Texan, Darryl began his career in the financial sector just one day removed from earning his bachelor’s degree in corporate financial management and accounting at St. Mary’s University. Throughout his career, he has won awards for recruiting and development from Fortune 100 companies. In January 2007, he chose to begin and develop his independent practice. He joined Andres Gutierrez and Joseph Schuetze to form the PAX Financial Group. Darryl also served as the Chairman for Brooks Development Authority. Shortly after his service, Mayor Julian Castro, named a park “The Darryl W Lyons Park” in honor of his service. He was named to the 2010 San Antonio Business Journal’s “40 Under 40 Rising Stars,” which honors people making a difference in business and in the community.

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