Retirement Money Management: What You Should Know–PillarWM

Retirement money management is something that crosses every high-earner’s mind at one point or another. When you’ve spent a lifetime accumulating wealth, you can afford to retire early. However, it is all too easy to lose track of your money and end up running out of your savings sooner than you thought you would. Working with a retirement planner or a wealth manager can help you manage your wealth and investments to provide a sustainable income for your retirement. For ultra-high net worth investors, our Ultimate Guide can help you find the right professional advisor to work with.

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Affluent individuals tend to focus on creating retirement income through multiple sources. This allows them to afford the luxurious life they are currently living even after they retire. At Pillar Wealth Management, we offer wealth management and retirement planning services to high net worth and ultra-high net worth individuals having a net worth of 5 million to 500 million dollars in liquid assets. We can help you create a customized plan that gives you financial security in your retirement.If you would like to get started, call us to schedule your first consultation.

Getting Started on Retirement Money Management

It is necessary to think about how you will manage your time and money after you retire. In some cases, you might have goals that you want to achieve. You might want to travel more, start a new hobby, work with non-profit organizations, donate more to charity, renovate your dream house, or simply enjoy the luxuries you have now.

Retirement money management allows you to secure your financial status and sustain your wealth to support your and your family’s living standards. That being said, not everything will go your way. If you don’t manage your money, income drainers can affect your saving and deplete them sooner than you think. We understand that managing a large fortune can be an insurmountable task. Fortunately, our wealth managers are experienced enough to handle multiple high-value assets. Get in touch with our team for your first meeting.

Why Do You Need a Retirement Plan?

High-spending lifestyles are difficult to maintain without an active income. After all, you want to prioritize spending on yourself. It is much easier to spend freely when you have a good grip on yourretirement money management.

It is natural to worry about concerns that come with your eventual retirement. If you have a plan drafted with the help of a professional can ease many of your worries and greatly reduce the chances of those concerns becoming a reality. Here are the primary aspects that necessitate retirees to have a retirement plan.

Unexpected Expenses

Even a net worth of millions of dollars doesn’t immunize you from the threat of running out of money. Retirees are reliant on their savings to keep themselves afloat, and these savings can be drained in a number of ways.

Inflation is something you might overlook. The inflation rate in the U.S. was1.7% at the end of February 2021, as per the U.S. Labor Department. It is safe to say that you can expect this value to increase even after your retirement age.

Economic downturns and other unforeseen circumstances can end up increasing your expenses far beyond what you initially planned for. Therefore, a financial advisor or wealth manager is useful in helping to adjust your retirement plan with life changes.

Liabilities and Threats

Wealthy families are constantly at risk of being taken advantage of for their money. Whether from external factors, disgruntled employees, business partners, unprofessional financial advisors or brokers, and even family members, your wealth can suffer the consequences.

Even after you retire, you can’t predict your life changes. Lawsuits, liabilities, divorce, or ill-advised investment decisions can end up costing you a charge chunk of your savings. Our book, The Art of Protecting Ultra-High Net Worth Portfolios and Estates – Strategies For Families Worth $25 Million To $500 Million, talks more about the threats the wealthy families face.

Creating a retirement plan helps you prepare for these threats, especially when you have an expert watching out for your financial health. They can recommend insurance policies that protect your savings from being expended.

Medical Expenses

Health issues are inevitable with age. Even if you consider yourself physically healthy, accidents, injuries, and diseases are unpredictable. If you don’t plan for your post-retirement medical expenses, you could find yourself bankrupt sooner than you think.

Medical procedures, expensive medicines, disabilities, full-time caretakers, and doctor visits can eat away your savings. By planning for your retirement, you can use medical and life insurance policies to make sure that your medical expenses won’t affect your retirement savings.

Family Support

Even after retiring, you might have children or family members who are financially dependent on you. In such cases, you’ll have to use your savings to pay for their expenses, whether education, weddings, or more.

A retirement plan can help you arrange a passive source of income by investing in certain assets. The earlier you start planning, the easier it will be for you to organize sufficient funds for your family’s financial stability without compromising your financial status.

What are Your Sources of Retirement Income?

When searching for retirement options, you might have heard about different retirement accounts, i.e., the 401(k), social security, pensions, etc. As a high net worth or ultra-high net worth investor, you understand the gravity of making the right decision. Hence, you might be wondering, “What is the safest place to put retirement money?”

Many rich individuals have a plan to focus on creating retirement income to keep the cash coming in even when you don’t have an active income. If you have more than 10 million dollars at stake, you can benefit from the advice of an expert. They can help you identify and analyze potential income sources for your retirement plan. You can learn more about finding the best financial advisor for your unique monetary needs in our Ultimate Guide to Choosing the Best Financial Advisor for Families worth $5 Million to $500 Million.

Here are some retirement income sources that you could consider:

Equities

High net worth and ultra-high net worth individuals have numerous equities in their name, which can act as a source of retirement income. For example, if you have substantial home equity, you can consider downsizing after your retirement to free up some cash. Alternatively, a reverse mortgage is a strategic move that allows you to borrow money against your home’s value. However, you need to weigh the risks before you make any big decisions.

Some wealthy investors have businesses that they can sell to convert into retirement income. In this case, you’ll have to consider the tax impact it brings and how your business partners or shareholders will be compensated.For this reason, it is best to consult a wealth manager regarding financial decisions.You can talk with our wealth management team to ask about an array of financial matters.

Inheritance

An inheritance can bring a significant influx of cash into your savings. However, it also comes with taxes. If you want to leave an inheritance for future generations, it will also affect your retirement income. In either case, you can use the help of a financial expert who can create a retirement plan that can integrate your revenue needs with a future inheritance.

Social Security

Social Security benefits are calculated after accounting for your 35 highest-earning years. However, there are uncertainties about how Social Security will be able to support generations in the long-term. The benefits received from Social Security are funded, administered, and taxed in a particular way. Policy changes can affect your long-term retirement income picture, forcing many retirees to depend on more than one source of retirement income.

Pensions

Pensions are a great income source entitled to a few people. Pension payment provision plans are changing all the time, with each company coming up with varying policies. For example, you need to clarify with your company whether or not your pension will increase with inflation and how it will be calculated.

There are two types of pensions, single annuity or a joint and survivor annuity. A single annuity provides benefits until the worker passes, while a joint and survivor annuity offers reduced profits until the survivor passes. A retirement plan can help you understand which decision to make.

Retirement Savings or Investments

When you retire, you’ll tap into the savings in your retirement accounts,whether IRAs, 401(k)s, or other taxable accounts. Converting these into an ongoing income can require some planning since each way has tax consequences that you should be aware of. You can opt for periodic withdrawals, selecting an annuity, or allocate more assets to income-generating investments.

With a retirement plan, you can invest in securities that provide a monthly income or periodic returns based on their performance. Investment managers or wealth managers can use strategies to maximize the profits you gain from your investments. Some of these are mentioned in our 5 Shifts Guide – 5 Critical Shifts For Maximizing Portfolio Growth Strategies – For Families Worth $5 Million To $500 Millions.

Income-Generating Activities

Some retirees wish to work part-time or as freelance workers even after they retire. Others prefer pursuing a new business venture. When you have an active income, there is less strain on your savings, and you can contribute more to them. Working with companies can also offer you insurance benefits.

For example, some companies have a phased retirement program that allows you to receive your pension when you reach your retirement age; meanwhile, you continue to work as a part-time employee.

Wealthy investors are also more likely to have multiple investments that act as an alternative source of income even after retirement. If you have a high net worth and are committed to enhancing your investment performance, we strongly commend this Performance Guide – Improving Portfolio Performance: The Shifts Multi-Millionaires Must Make to Achieve Financial Security and Serenity.

Retirement Planning Services at Pillar Wealth Management

When you have worked hard all your life to build a fortune, you want to enjoy the liberty of spending it how you want. A well-rounded retirement plan can allow you to prioritize spending on yourself as you won’t need to worry about whether or not you’ll have enough money to sustain yourself once you stop working. The right financial advisor will help you through the retirement money management process, but as a wealthy investor, you understand that you must be cautious about who you trust your finances to. Our Ultimate Guide to Choosing the Best Financial Advisor for Families worth $5 Million to $500 Million can tell you all you need to know.

At Pillar Wealth Management, we have created an exclusive, 100% customized retirement planning process that answers your questions about retirement with definitive, precise, and clear numerical projections and hard data. We have worked with clients with 5 million to 500 million dollars in liquid investments for over six decades. Schedule your first free session with one of our proficient wealth managers.

Authors

Hutch Ashoo

Chris Snyder

To be 100% transparent, we published this page to help filter through the mass influx of prospects, who come to us through our website and referrals, to gain only a handful of the right types of new clients who wish to engage us.

We enjoy working with high net worth and ultra-high net worth investors and families who want what we call financial serenity – the feeling that comes when you know your finances and the lifestyle you desire have been secured for life, and that you don’t have to do any of the work to manage and maintain it because you hired a trusted advisor to take care of everything.