As many people prepare their taxes this time of year, they think about their income and expenditures from the year prior and how this year could change things. It’s also an ideal time to think about retirement.

In a perfect world, everyone would start saving for retirement early and they’d have enough resources throughout their entire careers that they’d be fully prepared for a long life in retirement. The general rule of thumb has been to put away 10% of current income to meet future needs, but unfortunately, that can’t always be the reality. For those who are still early in their careers, there may not be enough income coming in to save in the first place, especially after covering the rising costs of rent and paying back high-interest school loans. For people who have more monthly income, there could have been a time when the person was out of work due to caring for a child or a lay off. Or, maybe an unexpected health event or home repair forced people into their savings. These things happen. The team at Chelsea Groton Financial Services understands the challenges people face as they balance a number of ongoing personal and financial obligations with their goals for the future, and they are prepared to help.

The importance of a financial advisor

Changes in the financial environment, including tax laws and interest rates, will affect the amount of money that people are able to save for retirement. And changes to Social Security and medical coverage will change income stream and expenses in retirement. Putting a few thousand dollars into an IRA each year is a wonderful start to building retirement savings, but it shouldn’t be the only investment people rely on.

“Every day, 10,000 Baby Boomers turn 65 and this is going to continue until 2030*,” said John Uyeki, SVP, Director of Financial Services at Chelsea Groton; Financial Advisor, Infinex Investments, Inc. “Our goal is to work with these people enough in advance that we can really help them prepare for their futures. We are in the business of helping folks convert their assets into retirement income. It is difficult to do that successfully if funds aren’t properly allocated.”

“The optimism towards equity-based investments is so high, it’s almost uncomfortable,” continued Uyeki. “Too many investors become aggressive when they feel they are missing out on a bull market. We try to educate clients on the importance of sticking with a plan. We take a strategic approach to optimizing the assets a client has, to ensure clients are properly allocated to have the long-term income they will need in retirement.”

Making a plan

The first step to ensuring you can have an income stream in retirement, or you’re able to make up for any gaps in income or savings, is to talk with a financial advisor. The advisors at Chelsea Groton Financial Services ask new clients to answer questions and provide documents such as mortgage statements, current investments, tuition costs, and weekly spending, which help tell the story of their current financial situations. Based on the information provided about spending, savings, and anticipated retirement income, the team of financial advisors will use risk and financial planning tools, along with decades of combined experience, to develop a plan that will help you meet your goals for retirement. If clients have partners, it’s important that couples attend these meetings together so both people have an understanding of the financial decisions being made.

According to Uyeki, “At Chelsea Groton Financial Services, we take a holistic approach to planning. We listen intently to our clients, get to know their risk tolerance and are committed to helping them achieve their goals for the future. We care immensely about maintaining the trust of customers and the community for many generations to come.”

Revisiting the plan

Once your financial plan is in place, it’s important to schedule a follow up at least once a year with your financial advisor since circumstances change. Divorces, marriages, taking care of grandchildren or elderly parents, or a spouse falling ill can all affect income and savings in preparation for retirement. Asking questions, including “where” documents can be found, “why” an approach or investments have been selected, and “how” things could change if a spouse passes away, will all help to alleviate possible challenges in the future. As income rises and retirement dates get closer, savings behaviors and ensuring your financial plan is set up to maximize growth in retirement become more and more important.

The team at Chelsea Groton Financial Services will ensure you are comfortable with the plan moving forward and will help to develop a portfolio that can meet your goals and risk tolerance as you grow older and more dependent on that income.

If you’re interested in learning more about the ways the team at Chelsea Groton Financial Services can help you develop a custom financial plan to suit your needs, please visit chelseagroton.com or call 860-572-4040.

About Chelsea Groton Financial Services

Investment and insurance products and services are offered through INFINEX INVESTMENTS, INC. Member FINRA / SIPC. Chelsea Groton Financial Services is a trade name of Chelsea Groton Bank. Infinex and the Bank are not affiliated. Products and services made available through Infinex are not insured by the FDIC or any other agency of the United States and are not deposits or obligations of nor guaranteed or insured by any bank or bank affiliate. These products are subject to investment risk, including the possible loss of value.

*Pew Research Center, Baby Boomers Approach 65 - Glumly, December 2010