Four Strategies To Grow Your Client’s Finances In Retirement

Retirement is the time in your life when you can throw off the shackles of your daily responsibilities and truly enjoy the fruits of everything you spent years working toward.

It’s an empowering feeling and you’ve earned it. You’ve planned and you’ve saved, but now that you’re here, don’t make the mistake of believing your financial planning is over.

As a retiree, taking an annual review of your finances is more important than ever. You deserve to live the retirement you want. To be sure your finances are up to the task, here are a few specific items to review in your annual post-retirement financial checkup.

1. Life expectancy

When you first created your retirement plan, you likely discussed an end-of-life age with your adviser you could use as a benchmark and plan toward. Now it’s time to revisit that age again and take an objective look in light of your overall health and any existing conditions you may have. And don’t be surprised if you find out you’re poised to live far longer than you expected all those years ago. It’s great news, but it also means you must adjust your finances accordingly.

2. Life insurance

Look at your life insurance policy. You should take the time to determine if it is still needed or affordable now that you’ve entered retirement. As you review your life insurance policy, you may determine you don’t need it anymore because your children are no longer dependent on you and you have minimal outstanding debts. You may also find the premiums have increased in recent years and the policy is too costly to maintain. If this is the case, you may want to sell it. It’s one less financial burden you need to worry about and the influx of additional cash will be a welcome surprise.

It’s important to remember your life insurance policy is your own personal property and you have the right to sell it, just as you would any other financial assets or physical possession. The sale of your policy to a third-party investor is known as a life settlement transaction and selling the policy could bring you as much as seven times the amount you would earn for surrendering it. Typical candidates for a life settlement transaction are age 70 or older with a policy of $100,000 or more, according to the Life Insurance Settlement Association (LISA).

3. Asset allocation

During your working years, you probably reviewed your assets several times and you may have even done some rebalancing to ensure you had the right mix of bonds, stocks and cash in your financial portfolio. But this practice doesn’t end simply because you’ve entered retirement. Look at your assets and take the opportunity to rebalance – just as you did during your working years – to ensure your money is meeting both your short-term needs and your long-term goals.

4. Home equity

Your home is often your most valuable asset. If you own the home where you live, take a moment to assess the amount of equity you have tied up in it. This may be the perfect time to downsize. You could also consider a reverse mortgage, which would allow you to convert some of the equity in your home into cash you could use for other needs. The money you acquire through a reverse mortgage or through the sale of your home via downsizing could then be used to invest in a fixed-income investment – such as annuities or bonds – that will provide ongoing income.

To learn more about life settlements, how they work and whether you’re eligible, call 888-521-8223 or visit the LISA’s website at lisa.org.