Milestone birthdays often stimulate reflective thoughts about where you are and where you are headed. Turning 50 is especially thought-provoking. Reaching that milestone brings the realization that retirement years are no longer a distant concept. Multiple studies indicate that many 50-somethings are not prepared for their golden years, but the good news is that there is that it’s not too late to put yourself in a significantly better situation when you retire.
Consider your 50th birthday as a call to action, and you will look back at the decision as a valuable turning point.
“When you transition from pre-retirement to post-retirement, not losing money is the focus. It is about maintaining lifestyle and not running out of money,” Lofton said. “The ultimate goal is to sustain lifestyle and prepare for contingencies, like the death of a spouse, long-term care, losing a pension and other unknowns.
“When you are in your pre-retirement years, you know how much money you make, you know how much you need to save, you know when you will retire and you know your monthly expenses. Life changes when you retire. Since you do not know your lifespan, or your spouse’s lifespan, you do not know how long your money needs to last, and what unexpected life situations will arise,” he added. “This is why it is vital to have a blueprint – an income plan that allows you to be proactive and have peace of mind instead of being reactive and feeling worried about running out of money.”
Founded by Tim Lofton, The Cornerstone Group Planning &Wealth Management is located in Washington Township and is the only wealth management firm in Ohio to have wealth management experts, CPAs and estate planning and elder law attorneys working together under one roof.
Lofton operates The Cornerstone Group with his wife, Karrie and their team of financial professionals.
The firm provides every client with The Blueprint to Financial Freedom™, which addresses “The 5 Cornerstone Essentials™”:
- Income planning, which centers around the goal to ensure clients’ expenses can be paid each month with reliability for the rest of their lives
- Investment planning, which features an investment plan for the remaining assets after an income plan is established and anchored in a defensive and tactical approach
- Tax planning, which is designed to decrease tax liabilities
- Health care planning, which addresses current and long-term health care costs
- Estate planning, which ensures that assets go to beneficiaries instead of taxes or nursing homes
Running out of money tops the list of concerns for people nearing retirement, which is why the first focus is on Income Planning. Cornerstone implements its betaBlueprint™ proprietary income planning software.
Your 50s are an ideal time to focus on developing a plan, Lofton says.
“For many, this is a time when you are hitting your peak earnings, and your expenses may be reducing if you are empty nesters,” Lofton explained. “Starting a retirement plan is like beginning a fitness regimen. You have to first develop a plan, and then follow that plan. Taking the first step is part of that, and then you maintain it and build upon it. At 50, if there is a gap between what you have saved and what will be needed, you might have 15 years or so to fill that gap. This is why it is critical to take action and create a plan.”
Save with a greater sense of urgency
When you are in your 20s and 30s, retirement seems so far away that people tend to not place an emphasis on developing and maintaining an income plan. At 50, the time is right to do so.
“It’s important to get serious about your long-term financial goals when you turn 50,” Lofton said. “If you are looking to retire at 65, 15 years is enough time to create a retirement nest egg, but time is of the essence now compared to when you were 30.
The federal government recognizes the importance of saving aggressively in the last 10 to 20 years of your career: Americans who are 50 or older can make additional catch-up contributions to tax-advantaged retirement accounts like IRAs and 401(k)s by adding to the annual limits that apply to those who are under 50. A few thousand dollars can make a dramatic difference over 15 years.
Work with experts
The Employee Benefits Research Institute asked people in a survey what was the most helpful thing they did to save, and most said it was hiring a financial adviser. Professional guidance helps you set and maintain effective goals.
Celebrating its 25th year, The Cornerstone Group has carved a niche as a fiduciary, meaning that it does not represent a single product, but instead has a legal and ethical obligation to put the other party’s interests first.
“There is not a one-size-fits-all solution for retirement planning, transitioning from working into retirement and then maintaining a comfortable lifestyle in your retirement years,” said Bill Rowe said, who is vice president at The Cornerstone Group. “This is why being a fiduciary team fits our objectives to help clients effectively and proactively navigate to and through retirement.”
Prepare for the unexpected
Hefty medical bills can quickly zap a lifetime of savings, which is why it is vital to protect your money against unexpected health care costs.
Safeguard your finances against unexpected medical costs. Some hefty medical bills can quickly eat up a lifetime of savings.
Retirement planning must include some consideration of future medical costs, such as long-term health insurance. Health care planning addresses current and long-term health care costs and is one of “The 5 Cornerstone Essentials™”
Make contingency plans
At 50, you likely know that life does not always proceed as anticipated. Creating a plan helps respond to abruptly changing circumstances, like the loss of a job, or an unexpected illness or injury.
As part of The Blueprint to Financial Freedom™, The Cornerstone Group helps clients understand the benefits they are entitled to receive in an all-inclusive financial plan to protect them.
“When you reach post-retirement years, you know that something could happen to you or your spouse that could drastically change your life, and at the same time, you are also enjoying freedom and happiness that are well-earned, if you have planned for your retirement,” Lofton said. “Remember, you are the CEO of your retirement. It is better to be proactive than reactive with no plan.”
For more information, visit www.thecornerstnegrp.net.