I like to think I’m still in my 20s, but the truth is, I turned 46 last year. At this point, I’ve been working full-time for more than half of my life, and financial independence/retirement is closer now than at the start of my career.
If you’re a mid-career professional too, chances are, you’re starting to realize that your financial independence is actually in sight. You may be asking, can I really do it? Am I ready? And what can I do now to be fully prepared?
At Lake Road Advisors, we specialize in working with clients who are at a similar stage of life. We guide people who can envision a retirement that’s in sight, but who are unsure exactly when they can walk away from their careers and still thrive financially.
If this is you, we can help you create a solid plan for retirement. But to do that, it’s important to answer three questions first.
Big question #1: Have my goals for retirement changed?
Nearly 15 years ago, you may have pictured yourself traveling the world or knee-deep in hobbies. But as retirement gets closer, you realize your career provides important meaning and purpose to life. You may enjoy helping people or challenging your mind. Whatever your reason, it’s okay to want to continue working in some capacity, perhaps as a consultant or in a part-time capacity.
You don’t have to set your plans in stone, but it is wise to consider whether you’d like to keep working or step away altogether. Why? Because from a planning perspective, even a small amount of income from part-time work can greatly improve your chance of becoming financially independent and meeting your goals. After all, it’s more time that your assets grow and are not drawn upon for living expenses.
The beauty of today’s remote world is that most of our clients have the opportunity to consult or pick up side hustles once they step away from their primary career. Think about what works for you. Is there a way you can earn income to help you offset the amount you need to pull from your assets? Earning even a small income may allow you to step away from your current role much quicker while still being on target for your long-term plans.
Big question #2: Do I need to reevaluate my lifestyle and spending?
Next, it’s time to look at the cost to live your lifestyle and honestly ask yourself these questions:
- What does my current spending and saving look like? Is this where I want to be?
- What type of lifestyle do I want in retirement?
- Is this the same as what I spend on a monthly basis or is this more?
- Will I have enough income and assets to achieve my goals for retirement and do the things I’ve always wanted to do?
- If I don’t have enough, how will I get there? Can I save and invest more, or spend less?
In retirement, we are essentially rebuilding your paycheck from multiple sources (assets, pensions, social security, etc.). At a minimum, you need to ensure you will have enough income to maintain the standard of living you want (think housing, food, and other regular expenses).
Big question #3: What’s my plan for future medical care?
Eventually, your employer-sponsored healthcare will end, and you’ll need to have your own coverage, whether it’s an individual plan and/or Medicare. Now’s the time to understand your healthcare options and consider using health savings accounts (HSAs) as part of your retirement savings strategy.
The tricky part is that Medicare coverage only begins at age 65, and almost all our clients want to be financially independent before then. This creates a healthcare coverage gap you will need to plan for. Could you move to a spouse’s plan? Does your employer offer a plan for retirees? Or will you need to go to the exchange and purchase a plan? This gap can represent a big expense you will need to plan for when considering your retirement.
Don’t wait—it’s time to reassess your plan today.
Mid-career professionals don’t have the luxury to delay financial planning. Now’s the time to reevaluate your goals and financial plan to ensure you feel financially secure during retirement. At Lake Road Advisors, we can help you assess your financial situation—we’ll help you understand where you are and partner with you to make the necessary changes to get wherever you want to go.
Want to talk? Set up a no-obligation introductory call here.
Lake Road Advisors, a Fee-Only, independent financial planning firm with offices in Corning, NY, Ithaca, NY and Portland, OR works with clients virtually all across the country. Paul Sydlansky, the founder of Lake Road Advisors LLC, has worked in the financial services industry for 20+ years. Prior to founding Lake Road Advisors, Paul worked at Morgan Stanley in Manhattan for 13 years. While at Morgan Stanley, Paul was a senior-level manager within the Institutional Equities Department. In 2018 he was named to Investopedia’s Top 100 Financial Advisors list. Paul received a Bachelor’s degree in Economics from Marist College and holds an MBA from New York University Leonard N. Stern School of Business. Paul is a CERTIFIED FINANCIAL PLANNER™ and a member of the National Association of Personal Financial Advisors (NAPFA) and the XY Planning Network. They can be reached by phone at the Corning, NY office at (607) 463-8400, Ithaca, NY office at (607) 438-2914, or Portland, OR office at (607) 292-2172 or at the firm’s website at https://www.lakeroadadvisors.com/
The information provided is for educational and informational purposes only and does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor’s particular investment objectives, strategies, tax status or investment horizon. You should consult your attorney or tax advisor.
