Episode #17: Are You Asking The Wrong Financial Questions

Today’s Prep:

To plan for retirement, you need to be asking the right kind of  financial questions. But what if you have it all wrong? David takes some of the questions he hears most and tells you what kind of questions you really should ask when it comes to saving and preparing for retirement.

(Click the featured times below to jump forward in the episode)

Equipping Points:

[1:23] – How Much Money Do I Need To Retire?

  • A better question is “What lifestyle do you want to live in retirement?” Some people want big trips, while others are just fine living on little. Paint a picture of what you want retirement to look like in order to put together a plan. Don’t forget to plan for inflation!

[3:55] – Should I Get Long-Term Care Insurance? 

  • Some feel this is a yes or no question: Should you buy a policy or roll the dice and take your chances? But there are a few more options to consider:
    • If you buy a policy, make sure you understand that your premiums will likely increase or your benefits will go down over time.
    • If you roll the dice and self-fund, do you have enough assets to truly pay for long-term care?
    • Another way to offset expenses of long-term care is an accelerated death benefit on a permanent life insurance policy.
    • A fourth way is an “asset-based plan.” For instance, putting to work money you have in a CD into a different kind of insurance policy.
    • Or you can combine all of these into your complete plan. Depending on who you are and what kind of risk you are planning to take yourself, you can come up with a solution instead of just ignoring it.

[7:50] – What Can I Do To Pay Less In Taxes This Year?  

  • Better yet, ask, “How much are you going to pay in taxes once you’re retired?” Your tax bracket in retirement may be the same or higher than when you’re working, since most of your deductions will be gone. Don’t forget every penny that comes out of a 401(k), 403(b), etc. will be taxed, and we don’t know what tax rates will be in the future. And make sure you partner with a qualified advisor as you engage in tax-related problem-solving.

[11:39] – Be Sure To Clearly Understand The Answers You Get From An Advisor.  

  • It starts by asking good questions, but the answers are key. Understand what the answers are, and be an active participant in your planning process. A plan that you help put together will yield a better result.

Today’s Takeaway:


More From David:

The host: David Dickens

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