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Retirement Planning Guide:

Are you looking for a retirement planning guide? A robust retirement plan is the key to securing your future and ensuring you get to live your post-retirement years in comfort. Working with a qualified wealth manager can make this happen. If you have an ultra-high net worth of over $2 million, we suggest you check out our guide to finding a financial advisor for managing $2 million to $500 million in liquid assets. It can help you understand the nuances of selecting a financial advisor who works for you and helps you retire comfortably.

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7 Secrets To High Net Worth Investment Management, Estate, Tax and Financial Planning

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 have a team of experts who can help you prioritize your retirement goals and plan accordingly. Our wealth managers can design an investment portfolio that aligns with your retirement goals, lets you prepare for risks, and reduces your costs. Book a free consultation today to learn more!

In this retirement planning guide, we will answer the following questions:

• What are the steps in retirement planning?

• What is the best option for retirement planning?

• What should you do before start retirement planning?

Let’s begin!

Retirement Planning Definition

Retirement planning means having a savings and investment plan that will ensure you have the income you need to cover your expenses when you retire.

Retirement planning involves getting started early with saving. You will need a budget to determine how much money you need for living expenses, now and when you retire. In addition, you need to select retirement accounts and investments.

You can invest more aggressively when you’re younger and more conservatively as you approach retirement age.           

When Can You Retire?

You can start claiming Social Security benefits at age 62. Full retirement age is 67 for those born after 1960, and benefits increase until age 70.

You can retire early and continue working. Part-time work provides a supplement to Social Security, in addition to providing fulfillment and a way to stay active outside the home.

How Much Do You Need to Save for Retirement?

By tracking your expenses over several years, you will establish a budget that takes into account most of the expenses you can expect to face during an average year. So, the sooner you start maintaining a budget, the better.

Your budget will include monthly, yearly, and day-to-day expenses. Monthly expenses include mortgage or rent payments, car loan payments, and credit card bills. Your yearly expenses comprise income taxes and insurance premiums, which may be biannual. You may have other loan repayments. Day-to-day expenses include food, home maintenance, utilities, phone, health care, clothing, transportation, and entertainment.

Compare the total of your expenses to your expected income when you retire, which will consist of your Social Security benefits, withdrawals from your retirement accounts, and potentially, income from property or an inheritance.

The difference between your total expenses for an average year and your projected future yearly income is the amount you will need to save each year to ensure you can maintain your current standard of living. Inflation should be factored into your calculation.

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The five phases are: planning and preparation for retirement, going on the honeymoon, disenchantment, reorientation and rebuilding, and establishing a new normal.

Calculate how much money you will need in retirement, determine what your income will be when you retire, calculate how much money you need to save, and cut down on unnecessary expenses.

A good retirement income should cover your basic expenses plus enough for extras like travel and entertainment. It may be less than your current income. You should also have a 6-month emergency fund.

You should consider your longevity, your health, inflation, and when to claim Social Security benefits; you need a strategy for transitioning your investments to a more conservative position as you age.

The first bucket holds income-producing assets such as Social Security and CDs. The second bucket has several years’ funding from conservative investments, and the third holds higher-return assets.

Don’t waste time doing routine tasks like housework and shopping. Consolidate your routine to liberate extra time for the things that interest you. Don’t make watching TV your main leisure activity.

In retirement, your expenses will be 60–80% of your pre-retirement level, but if you plan to have a second home or travel extensively, that number can be much higher.

The most popular retirement plans are individual retirement plans (IRAs), which include traditional and Roth IRAs, and employer-sponsored plans such as 401k plans.

The safest investments are savings accounts, CDs, money market accounts, bonds, and annuities. When investing in stocks, the safest strategy is to put your money in a highly diversified portfolio.

Investing in real estate is relatively safe as it does not decrease in value. You should get a return of around 5% when you’re ready to sell a property, and you can rent your property in the meantime.

How To Start Saving For Retirement                

By having a budget, you know how much you can save every week or month. Once you start saving, it creates a snowball effect. You become even more motivated to save as you see that account growing in value. Keep your retirement savings separate from the money you may need for major purchases, so you’re not tempted to spend it.   

To help you save, assuming that you have a 401k or an IRA, you can set up an automatic transfer from your bank account to the retirement account.

In a third account, start putting away some cash for an emergency fund, up to six months of expenses. Having that amount available for emergencies allows you to feel more financially secure.

For greater financial security, make a plan to pay off your credit card debt and make a habit of paying your bills without incurring interest charges. You want to be debt-free when you retire.

What Investment Accounts Should You Use? 

Once you start saving, and your savings accounts remain untouched, your gains each year grow along with the capital. Compounded earnings can grow quickly.

A safe investment account is a savings account, and some online savings accounts are yielding over 3% today. Watch for that rate to change and act accordingly.

Contributions to traditional 401k and individual retirement accounts (IRAs) are tax-deductible. An IRA is an account you open yourself. You’ll be taxed when you withdraw, with a penalty if you withdraw before age 59.5. At age 72, withdrawals become mandatory.

The tax advantage is that when you withdraw from an IRA or 401k, your tax bracket should be lower than when you make the contributions. If that won’t be the case for you, you should consider a Roth IRA, for which there is no tax deduction for contributions, but withdrawals are tax-free.

Note that your modified adjusted gross income for a Roth IRA must be under $153,000 for tax year 2023.

Employers may offer a 401k, a SIMPLE IRA, or a Roth 401k.

You can split contributions between accounts, but the combined contributions cannot exceed those allowed for a single account.

Funds can be rolled over from one account to another.

A simplified employee pension plan (SEP) is available to business owners or freelancers. A SEP-IRA is similar to an IRA, but with a contribution limit of 25% of your compensation or $66,000, whichever is lower, for 2023.

How To Invest For Retirement

The key to smart investing is diversification. By spreading your investments across asset classes, you mitigate your risks. Higher-risk investments are balanced against more conservative ones. You can safely assume that with diversification, some of your investments will perform well even if others lose some value.  

A traditional investment split is a 60/40 split, with 60% invested in stocks and 40% in bonds. Today, however, there are many more options, such as mutual funds, index funds, exchange-traded funds, and alternative assets.

The stock market has risen by an average of over 10% during the last hundred years, so stocks are always a good investment—for the long term. As you approach retirement, you’ll want to move into more conservative investments.

Consider combining diversified equity funds with individual stocks or stocks in a single growth sector. Equity funds may be a mutual fund or an exchange-traded fund.

A bond is a fixed-income instrument. Bonds are issued by governments to fund infrastructure projects, for example. Investors purchase bonds to earn a yearly income by lending money to a government body or a corporation at a fixed interest rate. Bonds are less risky than stocks while typically providing lower returns. They are a guaranteed source of income for the term of the bond, when the amount must be paid in full. Bond prices fall when interest rates go up.

Alternative investments are any assets excluding stocks, bonds, and cash. They include real estate, gold, collectibles, commodities, futures, hedge funds, private equity, and options.

Alternatives add to the diversity of a portfolio and usually consist of a small percentage of its total value.

7 Steps to Help You Plan For Retirement

7 Steps to Help You Plan For Retirement

Retirement planning is a long and ongoing process.You need to do your due diligence before you take any concrete steps toward building your retirement plan. If you are wondering what should you do before start retirement planning and during it, here’s a breakdown that can help:

Step 1: Figure Out Your Expenses and Spending Requirements

Before you start planning for retirement, the first thing you need to do is define the life you want to live after you retire. For instance, suppose you are living in New York City at the moment. Do you still plan to live there when you retire? Or do you want to move to another city like Miami?

You may also want to buy a new home in the city you move to. To make this process easier, we recommend visualizing your retirement years and making a list of everything you want to do.

What will your expenses look like based on this list? How much money will you need to spend on a daily basis to live the life you desire? Try and prepare estimates of these costs and define your spending requirements. Some examples of the expenses you will incur include:

Mortgage payments

• Travel

• Home repair

• Pets

• Insurance

• Fine dining

• Entertainment

• Other recreational activities

• Paying for your child’s college tuition

• Other outstanding loans

• Donations

Having a breakdown of these costs will help clarify your income goals.

Step 2: Define Your Retirement Goals and Time Horizon

Once you have your expenses in one place, you can see what your retirement goals are. You now know what you want to do once you retire and how much income you will need. Once you have this down, consider your time horizon. This refers to the number of years left until you retire. Having more years mean you can save up more for retirement. In the case of a shorter horizon, you can either:

• Adjust your goals to suit a more realistic timeline

• Increase your income sources to boost your earnings

In many cases, the first option is easier. The second option can involve making high-risk investments that deliver potentially higher returns. However, if you work with an experienced financial advisor, they may be able to help you figure out a way that helps you achieve most of your goals while controlling your risk.

If you are having trouble finding a financial advisor for high net worth individuals, click here to read our guide on the subject.

Step 3: Find a Financial Advisor With Experience in Retirement Planning

The next step in our retirement planning guide is finding a financial advisor who can help you plan for your retirement. This is easier said than done. Most financial advisors already have a predefined notion on how they are going to help you. They offer standard solutions that provide very little value to you.

If you are trying to find a financial advisor for retirement planning, we suggest you start by asking them the following questions:

• Have you worked with high net worth clients before?

• How will you identify my potential income sources?

• How will you diversify my portfolio?

• How will you help me monitor my goals?

• How will you help me control my portfolio risk?

• What will my investment and retirement planning costs look like?

Schedule a conversation with Pillar Wealth Management to find out more about this.

Step 4: Identify Potential Income Sources

Suppose you have a financial advisor on board. The next step is figuring out which income sources you can rely on to retire successfully. You can ask your financial advisor, “What is the best option for retirement planning?” There are various income sources you can consider here. Typically, your retirement income should come from the following:

• 401ks

• IRAs

• Equities

• Bonds

• Certificate of deposits

• Treasury bills

• Cash

• Pension

• Social security benefits

Your investment portfolio should include a combination of the above. Your financial advisor can help you decide how to allocate your assets. For example, if you have a longer time horizon and can make risky investments, then they will add a greater percentage of equities to your portfolio.

However, suppose you plan to retire in the next 10 years or so and don’t want to expose yourself to unnecessary risks. In that case, your portfolio can carry low-risk investments such as certificates of deposits, bonds, treasury bills, and other cash-based accounts.

If you want more information on how asset allocation works, click here to read our guide on how investors can boost portfolio performance.

If you require help with understanding what is the best option for retirement planning, book a free appointment with our wealth managers.

Step 5: Grow and Preserve Your Wealth

So you have defined your retirement goals and identified your main sources of income. The next stage involves growing and sustaining your wealth.

You may be confronted with many challenges here. For example, you could see a dramatic increase in your current expenses due to one or more of the following:

• You may get married or divorced

• Have a child

• Buy a new home

• Bear more healthcare costs

• Your business may go into stagnancy

As these costs rise, you might be compelled to treat your retirement savings as a safety net of sorts. If you are confronted with a dilemma like this, talk to your financial advisor. Remember, you don’t want to harm your long-term financial plan due to temporary hardships.

Your financial advisor can solve these problems by:

i. Revisiting Your Retirement Plan

If the need arises, you can go over your retirement plan again and see how your current situation impacts your ability to reach your retirement goals. You may need to readjust them again. It’s up to your financial advisor whether they are able to devise a better solution.

For example, if they make more strategic investments that cause your wealth to increase rapidly, then you may not have to make any significant changes to your retirement plan.

ii. Helping You Cut Costs

If you need help managing your current expenses, your financial advisor can try and figure out ways to cut your investment and retirement planning costs. They can help you reduce your taxes, utilize passive investing over active investing, control other internal expenses,etc.

Passive managers typically charge a lower fee than active managers. Passive investing also helps you reduce your short-term capital gain taxes. These gains are taxed at 37%.

Besides this, your financial advisor can help you prepare a tax minimization strategy that lets you defer taxes by investing in tax-free bonds. Municipal bonds are one example of this.

If you need more information on how a financial advisor can help you reduce costs, read our guide on getting a financial advisor for investors with $2 million and above in liquid assets.

Step 6: Retire

Once you reach your retirement age, it’s time to see if your retirement plan worked out as intended. The income sources you planned for earlier will come into play here. Everything from your retirement accounts, equity investments, bonds, and cash accounts will supplement your income to help you lead the life you planned.

As you withdraw from these accounts, you will have to plan for taxes and figure out how to reduce them.For example, if you put too much money into your 401(k) or IRA, then you can expect to receive more RMDs (required minimum distributions) than required. These distributions come with a high tax bill. To minimize this tax bill, you can consider using your 401(k) to make qualified charitable distributions and fulfill your donation goals. This can help you meet your RMD requirements while reducing your tax bill.

To learn more about how tax minimization works, click here to schedule a conversation with us.

Step 7: Prepare to Transfer Your Wealth

The final step in retirement planning is preparing to transfer your wealth. It involves estate planning to pass on your assets to your heirs as smoothly as possible. You can use a Will or Trust to do this. Bear in mind that although wealth transfer can occur toward the end, you need to prepare for it in advance.

For example, if you are a high net worth investor, you must have a Last Will and Testament in place for distributing your assets. This legal document can identify the beneficiaries of your estate. It also carries other important details, such as choosing a guardian for your children if they are under 18 years old.

Consider consulting an estate planning attorney for more information on this.

We also recommend getting a hardcover copy of our book, The Art of Protecting Ultra-High Net Worth Portfolios and Estates – Strategies For Families Worth $25 Million To $500 Million.

3 Things That Can Help With Retirement Planning

3 Things That Can Help With Retirement Planning

Now that you know what are the steps in retirement planning,here are a few tips that can make the process easier:

  1. Start as early as you can. A longer time horizon makes it easier to reach your goals.
  2. Keep revisiting your retirement plan to make sure you are on the right track.
  3. Focus on finding your comfort zone. Accumulating more wealth is important, but not as important as your peace of mind. As long as you are getting what you want out of the plan, avoid taking unnecessary risks.

Read our guide on 5 critical shifts all high net worth families should make to understand the importance of finding your comfort zone and achieving financial serenity.

Talk to Pillar Wealth Management and Get More Out of This Retirement Planning Guide

We hope you found this retirement planning guide useful for figuring out what are the steps in retirement planning.The importance of retirement planning and wealth management only increases with time. Regardless of how old you are, building and executing your retirement plan can help you lead a happier and more fulfilling life. It allows you to take advantage of new opportunities and use your assets in a way that helps you achieve financial serenity.

If you’re seeking help for retirement planning, talk to Pillar Wealth Management today. We can equip you with the correct knowledge and help you make the right decisions to secure your retirement. Our team can assist you in overcoming potential obstacles and pass on your financial legacy to your loved ones.

Talk to our experts and discuss what is the best options for retirement planning and what should you do before start retirement planning. Book a free consultation.


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.

You see, our goal is to only accept 17 new clients this year. Clients who have from $5 million to $500 million in liquid investable assets to entrust us with on a 100% fee basis. No commissions and no products for sale.

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