The Retirement Transition
The “Retirement Transition” is a crucial part of preparing for and navigating the journey into retirement. This service offered by Sovereign Wealth Management helps clients make the transition into retirement smoothly and successfully. Unlike retirement planning, which focuses on financial planning and preparations, retirement transition focuses on helping our clients to actually make the transition from their working life to retirement rather than simply preparing for it.
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The retirement transition involves assessing a client’s current situation, understanding their goals, and developing a personalized plan for success in their retirement years. This can include creating a budget, identifying opportunities to reduce or eliminate expenses, creating a retirement income stream, and determining healthcare needs. It may also involve exploring some of the emotional and psychological changes that come with retiring, such as redefining one’s sense of purpose and finding new activities to fill their time. A change made much easier by a healthy financial situation.
The process of retirement transition is closely connected to the other services offered by Sovereign Wealth Management, such as retirement planning, money management, and estate planning. Retirement planning lays the foundation for a financially secure retirement, while money management helps clients make the most of their retirement savings. Estate planning ensures that clients’ assets are protected and passed on to their heirs in accordance with their wishes.
Who Retirement Transition Services Are For?
Retirement transition services are ideal for individuals who are close to or have recently entered retirement. This stage in life can be overwhelming and stressful as individuals must navigate a new way of living on a fixed income while also figuring out how to make their savings last as long as they do.
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Retirement transition services are designed to help individuals make a smooth and stress-free transition into retirement by providing practical support and guidance and a detailed plan. This service is especially beneficial for individuals who may have questions about the best way to manage their finances during retirement or who may be unsure about how to make the most of their savings during this new stage in life.
The goal of retirement transition services is to empower individuals to take control of their finances and enjoy their retirement years to the fullest.
What Does The Retirement Transition Process Look Like? - Planning & Execution
We generally start out by understanding what your monthly budget looks like. This is fundamental to planning for a successful retirement transition and in determining your overall probability of success. How much money do you need every month to live the lifestyle you want in retirement? Our detailed and well-thought-out budget, including the client’s wants and needs, will help provide this information.
Once we understand your needs, we seek to understand your fixed income sources. Generally, this consists of Social Security, a private pension, and/or annuity payments, all of which arrive in your checking account every month and will continue to do so for the rest of your life (and potentially your spouse’s life). At Sovereign Wealth Management, we also help guide clients through the selection of benefits to determine the best times to file for all available benefits. By helping clients understand all the options that are available to them, our clients achieve better outcomes.
With a full understanding of your various benefits and income sources, we will determine whether or not there is an “income gap.” An income gap is a situation where your monthly expenses in retirement are higher than your monthly (fixed) income, causing you to run a monthly deficit. This is where having additional retirement savings is critical, as you can use those assets to fill that income gap for the rest of your life.
We then consider all additional assets that you have accumulated throughout your working years (this can include 401k, 403b, IRA, savings, and any inherited assets), which can be used to fill that income gap effectively. As a Fiduciary and independent advisor, we work with multiple different partners and products that can help fill this income gap on either a guaranteed or non-guaranteed basis, depending on the overall situation and assets available. In reviewing these assets, we determine whether or not your desired lifestyle is achievable or if changes need to be made to achieve financial independence in retirement.
Once all the necessary information and available options have been gathered and analyzed, we utilize our advanced planning software to put the puzzle pieces together to structure and execute a complete retirement plan, ensuring our clients have the highest potential probability of success when transitioning to and through retirement.
Ready to Get Started?
Are you ready to take control of your financial future? Reach out and schedule an appointment to discuss how Sovereign Wealth Management can help you work towards true financial independence with our comprehensive fiduciary services today.