Retirement Planning

Retirement often presents a number of unique financial management challenges. Many MarsJewett clients approaching retirement face considerable one-time cash distributions or important choices concerning highly appreciated assets. We provide sound and thoughtful planning alternatives that can help you reach your unique goals.

MarsJewett helps you enjoy a long, happy, and financially secure retirement.

Prudent retirement planning may help protect decades of hard work and the careful accumulation of wealth from the inevitable impact of taxes and inflation.

Key Considerations

  • Careful rollover of your retirement plan assets. Rollover of lump-sum distributions of 401(k) and other retirement plans must be handled carefully to minimize taxes and preserve assets.
  • Arranging mandatory distributions from your retirement plan so that you receive the right level of income with the lowest applicable taxes. Mandatory distributions from retirement plans after age 72 should be structured to maximize resources and possibly avoid unnecessary taxes.
  • Managing stocks and stock options. Plans should be in place for highly appreciated stock or stock options, which can pose complicated tax issues at retirement.
  • Determining long-range asset management and income strategies. Appropriate asset management and distribution strategies are essential with a retirement that could span 30 years or more.

STAGES OF WEALTH MANAGEMENT

Stage 1: Accumulation of Wealth

Early Accumulation Years

During your career, you strive to balance your resources between immediate needs and the long-term savings required to obtain financial independence.

Pre-Retirement Years

Pre-retirement planning is critical to a successful long-term financial plan. The years prior to retirement tend to be the maximum earning years. Planning can help determine how much additional savings may be needed to replace your take-home pay plus cover the costs of health insurance, taxes, and often a margin to cover special expenses, including hobbies like travel. Projecting income taxes in the pre-retirement years and early retirement years can help determine the right types of accounts to direct the additional savings to.

Stage 2: Distribution of Wealth During Retirement

In this stage of wealth management, it is critical to project the trajectory of your retirement capital. We utilize financial planning software to project your sources of retirement income and expenses to see how long your capital may last. We often summarize projections under three categories:

  • X1 RetirementAn X1 retirement projection shows a client may deplete their saved capital before their life expectancy. From our experience, managing these retirement scenarios are the most stressful, as there is little margin. We often encourage clients in this situation to consider working longer, spending less, or a combination of these choices to allow their capital projection to look stronger.
  • X2 Retirement: Here, client’s look to preserve their capital throughout their life expectancy. Ideally, we encourage clients to strive toward at least an X2 retirement. From our experience, this provides margin for unanticipated goals and a buffer for unexpected risks they might face in the future. 
  • X3 Retirement:  X3 projections illustrate a client’s capital growing throughout retirement. Clients with these projections will want to carefully consider their wealth transfer strategy and estate plan.

Golden Years

One of the most joyful stages of our lives should be retirement, but this life transition holds many changes that can be stressful if not adequately prepared for.

Platinum Years

Over time, we assist families through many transitions. Incapacity challenges even the most prepared, and having a team who knows you and can assist you and your family is a great benefit. For those with financial margin, helping family and the community you serve may offer rich rewards.

Stage 3: Transfer of Wealth at Death

Knowing you may leave a legacy to your family or the charities you support is a great joy. The loss of our loved ones is inevitable and never easy. We have expertise coming alongside surviving family members with the many questions that arise.

Note: actual retirement projections fall amongst the range of these X1, X2, or X3 categories.  A clients’ choices: how much to spend, when to retire, etc., may result in different projected retirements. It’s our objective throughout all stages, to monitor and update our projections to help clients understand the impacts of their financial choices.

EDUCATIONAL RESOURCES

Why Tax Planning Matters

Why Tax Planning Matters

Check out the PDF below on Why Tax Planning Matters. Please bring a copy of your most recent tax return to your next review meeting, and we can take it from there.

Spring Cleaning for Finances

Spring Cleaning for Finances

As the emergence of the spring weather reminds us to clear the clutter from the closets and spruce up the yard, our finances often need a spring cleaning, too. Perhaps no month is timelier for honing financial knowledge than April. Perched perfectly between the winter...

Key Financial Data 2022

Key Financial Data 2022

If you are interested in the new numbers affecting taxes, retirement contributions, health savings, Medicare, and more, please read our download the PDF below to have on hand.

Why Tax Planning Matters

Why Tax Planning Matters

Check out the PDF below on Why Tax Planning Matters. Please bring a copy of your most recent tax return to your next review meeting, and we can take it from there.

Spring Cleaning for Finances

Spring Cleaning for Finances

As the emergence of the spring weather reminds us to clear the clutter from the closets and spruce up the yard, our finances often need a spring cleaning, too. Perhaps no month is timelier for honing financial knowledge than April. Perched perfectly between the winter...