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5 Must-Haves for Your Retirement Toolkit

This content is provided courtesy of USAA.


By J.J. Montanaro, USAA Certified Financial Planner™ Practitioner


So, I'll bet you think now that Easter is in the rearview mirror you've got a holiday reprieve for at least a few months. Well, surprise! There's no rest for the weary because up next ... it's National Retirement Planning Week. Oh, baby! You can only imagine my excitement when I was reminded of this by a couple of my colleagues at work. Not just a single day, but a whole week dedicated to a topic near and dear to my heart! I can't wait to share the news with my kids .


All kidding aside, I can't think of a better way to "celebrate" this festive week than to open up your own retirement toolkit, and see how things are looking. Is your box full of shiny manicured tools itching to be used, or is it just an empty shell which creaks as you open it, only to reveal a thick layer of dust?


Well either way, here's a checklist of tools you should consider adding, oiling, or updating in honor of this week's holiday:


Eyeglasses or Crystal Ball. In my mind, retirement planning starts with a vision. If you're in your 20's it may be no clearer than the idea that you need to take some steps to create options (no, not stock options) for your future. Obviously, the closer you are, the more concise your vision should be. And don't forget the non-financial stuff; retirement is not just a stack of dough. What will you do? Where will you live? Sure it could mean golf and travel, but it also might just mean working in a different type of environment or for fewer hours. Shine up your crystal ball.


Savings Discipline. I still remember a series of commercials from a few years back where the main characters secure their retirement by stumbling upon a miraculous find. In one version it was a priceless original of the Declaration of Independence stuck behind a painting bought at a garage sale. Nice thought, but not likely in the real world. Instead focus on building your own independence by saving and investing on a regular basis. If you're just starting your career, setting aside 10% specifically for retirement is a nice goal. Late to the game and you'll need to up your percentage.


Guaranteed Income. Create a situation which allows your recurring fixed expenses to be covered by guaranteed income. Guaranteed income could come in the form of military retirement, Social Security, pensions, or you could purchase your own guaranteed income in the form of an income annuity.


Retirement Portfolio. What's yours look like after the turmoil we've seen over the past few years? Have you built and maintained a diversified mix of equities (U.S., small/medium/large, foreign developed & emerging market stocks) and fixed income (all types of bonds, fixed annuities, cash and cash equivalents). If not, let National Retirement Planning Week motivate you to evaluate your portfolio in the context of your goals and targets.


Tax Strategy. And of course, it's April, so any discussion that didn't at least mention taxes would be lacking. And for retirement, tax-diversification should be top of mind. That means saving and investing in a manner that allows you to benefit today and tomorrow through building taxable, tax-free (Roth), and pre-tax investments.


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Just think, if you hadn't read this you probably would have just plodded through this week as if it was just any other, but now I hope you'll take a look at your own retirement toolkit and take action. As an added bonus, the gifts you "buy" for this holiday will be all for you.


When it comes to planning for retirement, do you have enough income to live off of? You've probably heard of annuities, but how can they help you reach your retirement goals?


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This material is for informational purposes. Consider your own financial circumstances carefully before making a decision and consult with your tax, legal or estate planning professional.


Certified Financial Planner Board of Standards, Inc. owns the certification marks CFP® and CERTIFIED FINANCIAL PLANNER™ in the United States, which it awards to individuals who successfully complete CFP Board's initial and ongoing certification requirements.


Financial planning services and financial advice provided by USAA Financial Planning Services Insurance Agency, Inc. (known as USAA Financial Insurance Agency in California, License #0E36312), a registered investment adviser and insurance agency and its wholly owned subsidiary, USAA Financial Advisors, Inc., a registered broker dealer.


This material is for informational purposes and is not investment advice, an indicator of future performance, a solicitation, an offer to buy or sell, or a recommendation for any security. It should not be used as a primary basis for making investment decisions. Consider your own financial circumstances and goals carefully before investing.


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