Planning for Retirement at 55: A Complete Guide for High Net Worth Individuals
Planning for retirement at 55?Itis not uncommon for high net worth and ultra high net worth individuals towant to retire early and enjoy life to the fullest. If you have more than $10 million in investable wealth, you might also be excited tocreate a solid plan for early retirement.However, despite your strong wealth portfolio, you have quite a few obstacles and risks to consider.If you aren’t well-versed in financial areas,it can get a little overwhelming. An easy way out is by working with a wealth manager who knows the ins and outs of high net worth retirement planning.Here’s what you need to do to find the best expert for your individual needs.
STRATEGIES FOR FAMILIES WORTH $5 MILLION TO $500 MILLION
The insights you’ll discover from our published book will help you integrate a variety of wealth management tools with financial planning, providing guidance for your future security alongside complex financial strategies, so your human and financial capital will both flourish.
Clients frequently share with us how the knowledge gained from this book helped provide them tremendous clarity, shattering industry-pitched ideologies, while offering insight and direction in making such important financial decisions.
At Pillar Wealth Management, we work with affluent individuals who have accumulated liquid assets worth $5 million to $500 million to create an effective retirement plan that minimizes their costs and risks. If you need expert guidance and support on your journey of planning for retirement at 55, feel free to contact us to book an initial consultation.
Table of Contents
Can You Draw Retirement at 55?
Yes. You can.For some people, itmay be too early to retire.But if you’re good at managing your expenses and have been saving diligently for some time now,there is nothing wrong with drawing retirement at 55. In fact, think about all the extra time you’ll have to enjoy your success, connect with family, travel the world, andindulge in all those activities and hobbies you can’t find time for now.
That being said, a lot of thought and effort goes into planning for retirement at 55. You need to invest your money smartly, build savings, and account for retirement taxes.
Here are the top challenges you must look out for when planning an early retirement.
– Waiting for seven years to get social security
– Generating incomebefore you can access IRAs
– Dealing with strict rules about 401(k) withdrawals
– Paying for medical insurance for a decade while waiting for Medicare eligibility
– Shortening your savings years while ensuring the money lasts longer
If you want to retire at 55,you should consider working with a professional wealth manager to devise a smart retirement plan keeping in mind the aforementioned factors.
Is it Too Late to Save for Retirement at Age 55?
It is never too late to start saving for retirement.If you have been postponing the task for a few years, trying tomeet your short-term financial goals, you can startplanning for retirement at 55 now.Instead of worrying about all the time you seem to have lost, focus on the present and start building saving habits.
First and foremost, you must develop a solid financial plan that maximizes your retirement savings without taking unnecessary risks.To ensure financial security down the line, you’d want to strengthen your portfolio. Here’s a quick guide on enhancing the performance of your portfolio for maximum returns in the long run.
It is natural to feel overwhelmed about planning for retirement at 55. The only way to eliminate stress from the equation is by hiring a professional wealth manager who understands your unique needs, goals, and expectations. For expert advice and guidance, feel free toschedule a no-cost, no-obligation consultation with one of the experts at Pillar Wealth Management.
Can I Retire at 55 With 500k?
Yes, you can.You just have to figure out how it will work for you.
If you think about your retirement, some numbers or rules may come to your mind. You might also be interested in finding out what other affluent individualsare doing to secure their financial future. We must tell you that your retirement goals should be a reflection of your lifestyle, monthly expenses, and sources of income. While you can surely take inspiration from others, you don’t need to follow the exact routes and chase the same numbers as others. Your financial situation,needs, and goals are unique. Hence, you require a personalized retirement plan.
If you want to retire at 55 with 500k, you should consider cutting down your expenses and increasing your retirement income. Things will get even easier if you have multiple people at home receiving social security or pension.
Your financial plan should focus on protecting your assets and preserving your wealth.To delve deeper into this topic, read our book –The Art of Protecting Ultra-High Net Worth Portfolios and Estates – Strategies For Families Worth $25 Million To $500 Million. This book will help you make smart and well-informed financial decisions, ensuring that you make the most of the available wealth management tools to lay a strong foundation for your legacy.
The key to retiring early is to understand how much you need to maintain your desired lifestyle in the golden years and see if you have enough resources to cover your expenses.
How Much Do You Spend?
Before creating a retirement plan, you must determine your annual spending level. The lesser the amount you withdraw from retirement savings, the easier it will be to retire comfortably before the typical ‘retirement age’.
This, however, doesn’t mean that you can’t enjoy your pre-retirement years. The idea is to determine your retirement spending need and allocate their budget accordingly.
Here are a few ways to find out how much you can spend each year.
Based on your current spending level, create a budget for retirement that keeps potential changes in mind, such as a paid-off property.
Income Replacement Approach
Allot a percentage (for example, 75% or 80%) of your current income for your retirement savings. You’ll have to maintain this throughout the golden years. You may keep it below 100% because, at one point, you’ll stop setting retirement funds aside and start paying payroll taxes.
How much do you think you’ll need in retirement to enjoy your desired lifestyle? Pick a round number, keeping your goals and expectations in mind.With this method, people tend to overestimate their needs butit’s okay. Overestimation is always better than choosing a number that’s too low.
You need to determine a near-accurate spending level for retirement because early retirement doesn’t offer much room for errors. It’s best to consult with a professional when coming up with a number that ensures you live comfortably and happily both before and after retirement.
Our expert financial managers are at your service to help you make the right decision. Let’s talk now!
Sources of Retirement Income
Once you know how much you need in retirement,you must determine how you will reach your goal. Evaluate the sources of your retirement income to ensure you’ll have enough to meet your spending needs.
Before we dive into different retirement income sources, let’s make sure you have the right approach to financial planning. Many high net worth and ultra high net worth individuals are open to taking risks in hopes of maximizing their profits. While it’s important to take chances, you should focus equally on your financial security if you want to retire before an average American.
Instead of chasing short-term gains, look at the bigger picture and seek long-term opportunities that involve minimal risk.There must be a balance between portfolio performance and financial security. With this mindset shift, you’ll be on the fast track to preserving wealth. Read our guide to discover which other shifts will help you secure your financial future as an affluent individual.
Apart from this, you need to create a strategy that combines the best techniques of active and passive management approaches in order to create a well-balanced portfolio.To learn how you can mitigate financial risks and overcome obstacles, read our guide on working with the best wealth manager who knows the intricacies of both approaches.
Without further ado, let’s dive right in to find out which retirement sources you can rely on to cater to your spending needs.
1. Social Security
Social security makes up a major portion of the household income of retirees. Hence, it is a crucial part of your retirement plan.On average, people in retirement get $1,503 a month and $18,000 per year. On the other hand, affluent individuals who manage to secure high earnings before retirement may receive as much as $34,000 annually.
However, if you’re planning for retirement at 55, you’ll have to wait at least ten years before you can enjoy social security benefits.
Pension income is the amount received by retirees from private employers, thestate, the federal government, or any organization. You receive it monthly just like your regular salary. For some people, the pension benefits may be quite generous. It might cover most, if not all of your monthly expenses, eliminating the need for tapping into your retirement savings.
3. Other Sources
Other income sources like rental income, royalties, part-time jobs, or consulting work may also reduce the amount you need to set aside for the golden years.
Why Work With a Wealth Manager When Planning for Retirement at 55
Wealth managers are equipped with extensive knowledge, tools, and resources to help you with your planning for retirement at 55. They don’t only offer expert assistance and guidance for developing a solid retirement plan but also work with you to revisit it from time to time to see if any modifications need to be made based on your changing financial circumstances.
When planning for retirement at 55, you need to work extra hard with persistence and dedication. An expert will work with you to develop an accurate projection of your annual spending needs and determine the amount of money you can count on during the golden years.
Experts know what kind of obstacles, challenges, and financial risks may hinder your planning for retirement at 55. They will answer your questions throughout the process, making sure that your assets are well-protected at every step of the way.
Get in Touch With Our Team at Pillar Wealth Management
At Pillar Wealth Management, our team of wealth managers is committed to helping high net worth and ultra high net worth individuals with retirement planning. If your liquid assets are worth $5 million to $500 million, we will help you create a legendary financial legacy, ensuring that you spend your golden years the way you have always dreamed.
During the initial consultation, one of our experts will discuss your current financial situation and determine your unique needs and retirement goals.We will then devise a well-thought-out plan aimed at meeting your short and long-term goals and maximizing your gains with little to no risk involved. You can rest assured that we will find a way to ensure your assets generate sufficient income for a few decades after you retire at 55.
If you want to enjoy maximum flexibility, comfort, and peace of mind in your golden years, you should start planning for retirement at 55 today. Get in touch with our team and start a conversation with an expert wealth manager now.
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