Your 2025 Retirement Planning Guide

Effective retirement planning is like assembling a jigsaw puzzle—each piece must fit together to create a complete picture of financial security. Hosts Joe Anderson and Alan Clopine of Your Money, Your Wealth discuss the essential strategies for budgeting, saving, and managing debt to ensure a comfortable and well-planned retirement.

Why Retirement Planning Is Critical

Retirement planning is essential, yet many people fail to take the necessary steps:

• Common Disconnect: Only 35% of individuals save the recommended 10% of their income for retirement.
• Puzzle Approach: A comprehensive plan ensures all financial elements work together toward your goals.
• Action Over Knowledge: Knowing what to do isn’t enough; actionable steps are essential for success.

How Longevity Impacts Retirement Savings

Longer lifespans require more substantial retirement savings:

• Life Expectancy vs. Savings: While many expect to live longer than their parents, only 22% consider working longer, and just 33% plan to save more.
• Cash Flow Needs: Increased cash flow is crucial for funding longer retirements. Start planning early to meet these demands.

Spending Trends in Retirement

The assumption that spending decreases in retirement is often a misconception:

• Increased Early Spending: Retirees frequently spend more in their initial retirement years on leisure activities and delayed expenses.
• Revised Assumptions: Plan for spending that could exceed pre-retirement levels instead of the commonly suggested 70-80%.

Balancing Debt Management and Savings

Debt repayment shouldn’t come at the expense of retirement savings:

• Avoid Large Withdrawals: Drawing large sums from retirement accounts to pay off debts can lead to substantial tax liabilities.
• Employer Matches: Prioritize saving in retirement accounts, especially when employer matches are available.

Planning for Long-Term Care

Long-term care planning is vital, as most retirees will need it:

• Key Statistics: 70% of individuals will require some form of care, yet only 33% have a plan in place.
• Funding Strategies: Options include savings, selling assets, or purchasing long-term care insurance.

Addressing the Fear of Outliving Funds

Outliving retirement savings is a top concern for many Americans:

• The Numbers: 45% of individuals fear running out of money, often due to a lack of financial clarity.
• Avoid Guesswork: Detailed financial planning is necessary to ensure funds last throughout retirement.

How to Estimate Retirement Needs

Understanding future financial needs is the cornerstone of successful retirement planning:

• Adjust for Inflation: Estimate future expenses and compare them to expected fixed income sources.
• Systematic Saving: Calculate how much to save monthly to meet retirement goals and stick to the plan.

Reconnecting With Your Retirement Plan

Reconnecting with your retirement plan involves actionable steps:

• Estimate Budgets: Outline realistic spending plans for retirement.
• Automate Savings: Ensure consistent contributions to retirement accounts.
• Address High-Interest Debt: Pay down debts with significant interest rates to free up more savings potential.

Audience Engagement and Takeaways

Interactive true/false questions during the discussion reinforced key points:

• Common Misconceptions: Topics included long-term care needs and historical retirement trends.
• Call to Action: Use resources like the “Reconnect Your Retirement” guide to build a personalized and effective plan.

Conclusion

Retirement planning requires a thoughtful balance of budgeting, saving, and managing debt. By addressing misconceptions, planning for longevity, and taking proactive steps, you can build a financially secure future. Start today to ensure a retirement plan that meets your unique goals and needs.

Intended for educational purposes only. Opinions expressed are not intended as investment advice or to predict future performance. Past performance does not guarantee future results. Neither the information presented, nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Consult your financial professional before making any investment decisions. Opinions expressed are subject to change without notice.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

• Intended for educational purposes only and are not intended as individualized advice or a guarantee that you will achieve a desired result. Before implementing any strategies discussed you should consult your tax and financial advisors.