Retirement Planning for a Secure Future

Retirement Planning for a Secure Future

white paper with "Retirement Plan" on it, on a deskWhen’s the last time you thought about your retirement finances? Busy nurses can’t be blamed if the answer is, “It’s been awhile.” But ignoring or paying little attention to your financial life before and during retirement will only shortchange you. Nurses, in particular, have situations such as per diem or travel contract work that can impact their savings and retirement plans. And for some nurses, talking about money is something entirely unfamiliar on a much larger level.

When Pablo Oliva, a wealth advisor with Northsight Wealth Management, LLC, was growing up, financial planning was not dinner-table conversation. “I am a first-generation immigrant, and we did not discuss money growing up,” he says. “Like many immigrant families, I did not learn about money until I started working in financial services in my early working years.”

Oliva says that he has a particular affinity for those who want to learn how to save for retirement and plan for life events, but who may not have an understanding of financial planning best practices. But someone without a complete understanding of financial tasks is still able to learn. Educating yourself about your financial standing is necessary, and getting help when you don’t understand something is essential. “After all, we all want to get to retirement and not have to worry about funding the following 20 to 40 years in retirement,” he says.

Starting conversations about finances can certainly feel awkward. “Growing up not talking about money allows me to empathize with others and help them open up about money,” says Oliva, who frequently advises nurses. “Seeking professional help for money-related issues should be second nature, such as visiting the dentist for a toothache or a mechanic for an oil change.”

No matter where you are in your career or in your retirement path, Oliva is optimistic about taking steps, any steps, toward a better future. “It is never too late to start,” he says, dispelling a common misconception. “I have often been told by individuals that they feel it is too late for them to start saving for retirement.” It’s true that the earlier you start, the more time you have to attain your long-term goals, says Oliva, but that doesn’t mean it’s ever too late to put money away.

Setting aside time is part of the process, so you can learn what tools and options are available to you. With long shifts and overtime, nurses often just want to enjoy the time off they have and don’t want to sort out a financial plan. But there’s lots on the table they also don’t want to let slip by including any options for matching or investing that their employer may offer. They also want to take advantage of their workplace benefits, which can include everything from financial advice to reimbursement for fitness costs.

And retirement planning is constantly changing based on life events or even global events. For instance, student loans have become front and center again because of recent changes. “Now that the COVID-19 federal student loan payment deferment has ended, most individuals will receive a higher payment than in pre-pandemic years, mainly due to higher earnings,” says Oliva.

As you think about your retirement plans and what actions you have taken or that you need to take, Oliva has some advice. “If you have not started saving for retirement, start today,” he says. “Most 401(k) or similar retirement plans offer a match component. Some employers still offer pensions and ancillary benefits such as a 401(k) student loan match.”

And if you decide to investigate anything that could impact your financial outlook, Oliva says caution should be your first reaction. “I recommend seeking a second opinion,” he says, “especially if something sounds too good to be true.”

 

A legal disclosure from Northsight for this interview: Investment advisory services are offered through Northsight Wealth Management, LLC (NSMW), a Registered Investment Advisor. Northsight Wealth Management, LLC will only provide investment advisory services in jurisdictions where it is registered as an investment adviser or exempt from registration. Insurance products and services are offered and sold through individually licensed and appointed insurance agents. NSWM does not provide legal or tax advice.

Questions for Retirement Planning

Questions for Retirement Planning

Are you ready to get your retirement plans in order? Even the most motivated nurse will find a few roadblocks when planning for retirement, but never let those roadblocks detract you from your goal. Trying to determine how much money you’ll need to live years or decades down the road can seem like an impossible task. And even if you’re putting some money away, you might wonder if it’s going to be enough.

According to Elliot Dole, CFP®, EA, AEP®, CExP™, CAP®, a Wealth Advisor with Buckingham Strategic Wealth, there’s plenty nurses can do to ensure they are on a good track for retirement planning and savings.

One of the easiest options is to use any employer-provided retirement benefits such as contributions, matching funds or even free financial advice from professionals as an employee benefit. Using pre-tax benefits or options like a Health Savings Account can save you tax dollars and help pay for healthcare-related costs. Ideally, every salary increase or bonus will be rolled into your savings process as well. These kinds of small steps will help your nest egg grow quickly without feeling too much of a pinch in your wallet.

But it helps to have an idea of how much you’re going to need for retirement, rather than just saving money and hoping for the best.

According to Dole, nurses can ask some hard questions to determine how much is enough to retire. Looking at the end, rather than the current day, will give you a more accurate frame of reference.

As no two people feel the same about retirement, you’ll need to decide what retirement means for you. Think about these questions:

  • What is most important–retirement date or retirement spending?
  • What retirement activities are important to you?
  • Do you plan to retire in a different location? Do you know where?
  • Do you see yourself working at other jobs past your official retirement?
  • When do you plan to begin Social Security?

As you ask those questions, you’ll be able to narrow down the amounts you’ll need to have the retirement you want. Consider these questions to give you a starting point:

  • How much do you want to be able to spend in retirement?
  • How much do you want to leave to loved ones or charity when you’re gone?
  • What gap exists between monthly social security, pension, or other retirement income that needs to be funded by your retirement portfolio?
  • What are the odds of success given your current and future savings and expected investment returns?
  • How does a spouse’s or partner’s financial circumstances factor into this?

It also is important to examine the emotions that surround retirement planning, he says. It’s easy to feel discouraged if you aren’t on track for saving enough. But until you know the real amounts you’re working with, you could be unnecessarily stressed (or, alternately, feeling relief that’s not based in reality).

Because the nursing industry offers varied employment options, nurses who work part time or on a per-diem basis might not have the same benefits available to them as full-time employees. “Nurses on a per diem basis may benefit from establishing IRAs and Individual 401(k)s,” says Dole.

Working with a professional can help you establish a solid foundation to build on and will continue your financial education so you can work in partnership on your retirement plan. Continue to learn more by reading, listening to financial podcasts, or taking classes in personal financial management. Remember that while retirement planning takes effort, once you’ve established how much you want to save and you’ve started a plan to get there, your work will decrease.

“The key is to get good strategic help related to your unique circumstances and goals,” says Dole. “Then live your life and let your plan work for you.”

 

5 Ways to Reset Your Life Right Now

5 Ways to Reset Your Life Right Now

The start of a new year brings new opportunities to organize all areas of your life. Some of that enthusiasm definitely starts to wane as January drags on, so this is a good time to plan some small tasks that you can do to make your whole year better.

Here are a few items to add to your to-do list that really will help get your life on solid footing.

1. Run a Credit Report

You can request a free credit report once a year from each of three different credit bureaus. Set a reminder to do one in January, May, and September, and you’ll have a much better control over your credit. Having a credit report run frequently lets you organize your credit, check in, and make sure nothing is amiss.

2. Evaluate Your Retirement Contributions

There are many different ways to set up your retirement savings, and no matter what you do, make sure you reassess your plan each year. If you got a raise last year, you should be able to put more into your retirement savings. If you turned 50 last year, you can add extra funds as part of a catch-up plan for those over 50. If saving money is one of your resolutions, this is where you put that into action. Designate what you might give up and figure out how much that would be each month (for instance, give up one coffee a week and save $20 a month). Then choose that as a set amount to automatically withdraw from your paycheck and go to your retirement.

3. Reset Your Environment

Lots of people advise clearing out the clutter to organize and have a more peaceful home environment, but that’s an overwhelming thought when you’re working a week of back-to-back shifts while juggling family and all your other commitments. So in the next month pick just one area of your environment that would bring you the most peace. Do you have a long commute? Maybe a clean and tidy car would make you feel a sense of calm. Is your kitchen the hub of your home? Cleaning off the counters will be like a breath of fresh air. Even a new playlist each month or a small bouquet of fresh flowers in your bathroom can brighten up your mood and get your day off to a good start.

4. Learn Something

Yes, learning a new language would be fantastic, as would playing the guitar or succeeding at skiing. But if you’re short of time, inspiration, and energy, find a small goal and perfect it. Learn how to make one go-to appetizer so you’re not perplexed when going to a party. Nail down your elevator speech. Find a new route to an old place. Clean up your resume. Fine tune three yoga poses to take care of yourself. Learn how to make your signature drink (coffee, alcohol, fruit – whatever you like). Gaining control over one thing often helps launch other accomplishments.

5. Accept Yourself

This one is harder than just about any other personal commitment. Once a day (or more if you remember!) tell yourself you are good enough and that you are strong. Say it out loud so you set that as an intention. Yes, we all can get better and can improve, but we all fail. We all mess up. Humans are far from perfect (even the ones on Instagram who look like they have it all together).

What are some other ways you can take small steps for big gains?

Retirement Planning for Nurses

Retirement Planning for Nurses

Are you saving for retirement? Here’s your guide to getting on track with securing your financial future.

Saving for retirement can often feel so daunting that you push it to the back of your mind. When trying to manage your career and other personal finance goals such as buying a house and paying down debt, retirement planning and investing often takes a back seat. You know you should ask your HR department about the 401(k) plan your company offers, but you never get around to it. But it’s worth the effort now so that you are well-prepared for the future.

The truth is many Americans are not saving for their golden years. According to a 2018 survey by Northwestern Mutual, one in five Americans has nothing saved for retirement. And 78% of Americans are “extremely” or “somewhat” concerned about affording a comfortable retirement. One in three Baby Boomers (33%), the generation closest to retirement age, have between $0-$25,000 in retirement savings.

Generations X and Y are often saddled with student loan debt and stagnant wages, making it a struggle to save.

While these are scary facts, the good news is that once you take the time to educate yourself on the basics of retirement planning and you take a few smart steps to invest, you can largely put retirement investing in the back of your mind and not feel guilty that you aren’t taking necessary action.

Jane Bryant Quinn, author of How to Make Your Money Last: The Indispensable Retirement Guide, says many people don’t want to think about retirement planning. She also says that making projections and calculating retirement budgets can be a pain but is important to do.

“You have to add up your savings, estimate what you’ll get from Social Security, make an investment plan, estimate how much income your investments will provide, and estimate your retirement expenses,” says Bryant Quinn.

To help figure all of this out, Bryant Quinn says to

create budgets. “If you’re married, make three estimated budgets—one for you as a couple, one for you if your mate dies first, one for your mate if you die first. For example, married couples get two Social Security checks (one for each). When one of you dies, the survivor will get the larger check but lose the other one. So, you have to plan for all circumstances,” she says.

Daniel Burke, CFP, ChFC, president of Burke Financial Group, LLC, says nurses spend their entire working careers caring for the needs of others, but often by doing this, they tend to neglect important planning components for themselves.

Are you ready to take action? Below are answers to the most common questions about retirement planning and investing to get you started on the road to a secure future.

What Are My Retirement Dreams?

Start with finding your why. What motivates you when you dream about your retirement? Do you want to spend a year traveling around the country in an RV? Do you want to move to a new city? Do you want to spend more time on hobbies such as gardening, crafts, or learning to speak Spanish? Or perhaps you want more time to devote to friends and family or a cause close to your heart.

Identifying the life you’d like to retire to can serve as a strong motivator as you start down the path of savings. It’s much easier to devote 15% of your income to your retirement account versus spending that money on something fleeting when you can envision the life you’re saving for.

How Do I Get Started?

“Benefits through the employer are a great place to start as nurses begin planning for themselves and their families,” says Burke.

Educate yourself on the retirement benefits offered by your employer. If your employer offers a 401(k) or 403(b) option with a matching benefit, sign up for the match immediately. If you are not taking advantage of your employer’s match, you are literally leaving free money on the table.

If your employer doesn’t offer a 401(k) option, then open a Roth IRA through a brokerage such as Fidelity or Vanguard. Contributions made to a Roth are after-tax contributions, but your money and earnings grow tax-free (meaning you will not pay taxes on any returns you earn from your investments).

What If I Haven’t Been Saving?

If you haven’t been saving anything for retirement, it’s important not to beat yourself up. You can’t go back and change the past, but you can commit to saving going forward.

Bryant Quinn offers the following advice, depending on your age.

New Grads: “Start a savings account, to have a little cash on hand. Put a little into your employer’s retirement plan, despite your student loan. If you change jobs, don’t cash out the amount you saved, take it with you to a new job,” says Bryant Quinn.

Mid-Career: Higher earning years means higher savings. “In your retirement plan, chose funds that lean heavily to stock market investments. It doesn’t matter if stocks go down. Throughout history, they have always come back,” says Bryant Quinn. “You have the time to wait. It’s your best shot at a nest egg. Keep contributing to your plan, even if your kids are in college (or at least try to).”

Near Retirement: Time to plan. “Keep investing in stock-owning mutual funds,” says Bryant Quinn. “You will probably live another 30 years (or more—my mom made it to 103). Over such a long period of time, stocks always go up.”

How Much Should I Save?

If you’re starting from scratch, a good starting point is to invest enough to get any company match offered by your employer. This is essentially free money and everyone should take advantage of it. For instance, if your company offers a 5% 401(k) match, you should invest no less than 5%. But that’s just a starting point.

Another strategy that Bryant Quinn suggests is to simply start by taking at least 5% out of every paycheck and putting it into your 401(k) or 403(b). “If you’re already contributing, increase the amount. What will happen when you get a slightly smaller net paycheck? Nothing will happen. We all tend to spend whatever money we have in our checking accounts. If there’s less in your account, you’ll spend less—even without a budget,” she says. “You’ll make small adjustments without realizing it. It’s the only magic I know in personal finance.”

If your company does not offer a 401(k) program or a match, you can open a Roth IRA through a brokerage service on your own.

“If you have no plan [at work], Individual Retirement Accounts (IRAs) can be purchased at low-cost no-load mutual fund groups such as Vanguard. They’re available at banks, too, but usually with higher fees. Always choose low-cost investments,” says Bryant Quinn.

Once you start gaining some confidence in your knowledge and are eager to save more Bryant Quinn suggests utilizing financial resources, such as online retirement calculators and budgeting tools to estimate retirement living expenses.

Overall, determine a percentage goal that works for you and challenge yourself to increase it incrementally (e.g., every six months or annually). You can also boost your savings effortlessly by automatically investing any annual or performance raises you receive. If you were living on what you made before you got a raise, just keep living off of that amount and invest the extra income.

Do I Need A Financial Planner?

If all of this sounds complicated and you would like a helping hand, consider working with a financial advisor. But choose wisely as many financial advisors get paid by selling you on specific mutual funds, often with high fees. These fees will eat away at your nest egg.

Your best bet is to hire an independent advisor who is fee-only or paid directly by you by the hour. Your company may provide consultations with an advisor from the administrator of your 401(k)/403(b) plan, but it’s important to remember that their loyalty is first and foremost with their employer, not you.

What Is the Biggest Mistake I Could Make?

“Not saving enough,” says Bryant Quinn. “You can save money, even if you’re living paycheck to paycheck.”

Ad