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Don’t Let These 3 Big Retirement Questions Derail Your Golden Years

Your vacation is over, your kids are back in school … Time to pack up your swimsuit and eclipse glasses and get back to working on that nest egg!

Fall always seems to spark a renewed sense of focus in my clients at Keen Wealth, so for today’s show, we thought it would be a good time to answer three big retirement questions from our listeners. 2017 continues to be a rough-and-tumble year, and when we’re talking about your money, it’s always a good idea to cut through the chatter on the news and the internet, and focus on the facts that really matter.

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Insights from Today’s Podcast on Listener Retirement Questions

1. "There’s talk of another government shutdown. Should I delay my retirement plans?"

This reminds me of what we were talking about a year ago after the political conventions. My clients and listeners were asking me if they needed to prepare two financial action plans, depending on who won the presidential election. Right now, some clients are ringing the office asking about the possibility of a shutdown, or if this terrible hurricane season is going to hurt investments. External events are always going to provoke retirement questions, especially among recent or soon-to-be retirees.

Regular listeners probably know what my answer is here, and not because I’m a broken record. We pride ourselves on the consistency of our strategies at Keen Wealth, and through all the tumult of the past year, I’ve advised, consistently, that our clients stay the course. No one president, no one natural disaster, no one political stalemate is going to topple a sound retirement plan. The history of the market trends up. If my Great Aunt Nina could live through two World Wars and the Great Depression, and still retire comfortably, then the plan that you and your fiduciary advisor have worked out will be able to survive some bumps in the road too.

As to the specific issue of a government shutdown, again, history tells us not to worry too much. Even if the government does shut down, the most immediate impact will be on workers employed by government agencies like the IRS and our national parks. We’ve had eighteen government shutdowns since 1976, none of which were fatal to the markets. In fact, during the most recent government shutdown in 2013, stocks actually rose 3.1%.

I’m not saying that we can count on the stock market to react predictively during the next government shutdown. I am saying that the gridlock in Washington is frustrating enough on its own. Don’t let it frustrate your retirement plans too.

2. "I recently attended a really nice steak dinner seminar where the financial person was touting this incredible –”

Whoa, let me stop you right there! Put your checkbook down!

Now, I encourage my clients to go to seminars and workshops. Getting as much info as you can about your finances can go a long way towards answering common retirement questions. But there’s a big difference between an educational lunch event at Keen Wealth, and a fancy seminar that seems to be pushing a particular investment product.

First of all, the phrase, “financial person” sets off an alarm bell. It suggests that maybe the host of this event wasn’t totally up front about his or her credentials.

This listener goes on to ask about Equity Index Annuities, the focus of this lovely steak dinner. The “financial person” was touting these annuities as all upside, with no downside. Sure … because their rate of return, in most cases, is barely better than just buying a CD. In our opinion, the only real upside is for the person selling the annuity.

Listen to this episode if you want more specifics about how Equity Index Annuities work, but there’s a very simple answer to these kinds of retirement questions: Is someone trying to sell you a product that sounds too good to be true? Then it probably is.

When external factors in the world feel unsettling, it’s tempting to grab onto these kinds of “can’t miss” investments. Staying the course laid out in your financial plan is almost always the more prudent move, but if you’re really interested in a product that’s new to you, talk to your fiduciary advisor.

3. “My elderly parents have their estate split three ways between me and my two siblings, including a Transfer on Death for some real estate holdings. Is this a sound strategy?”

Estate planning raises many retirement questions, both for the people making the plan and the beneficiaries. These folks are off to a good start. One common mistake is leaving everything to “the good kid,” and trusting that person to split up everything. Even if that “good kid” doesn’t book a one-way flight to the Caribbean, what one person thinks is fair doesn’t always sit well with other heirs. Being as specific as possible with your heirs about your wishes, both verbally and in your will or trust, is the best way to secure your legacy, your way.

However, it sounds like the parents in this scenario have an estate that includes a few different kinds of assets, each of which carries its own tax ramifications for heirs. In particular, Transfer on Deaths divided among beneficiaries can create lots of complications depending on where you live, and if you plan on selling the property. I would advise this family to get together with whoever prepared the will or trust and have a thorough review now that will limit any legal, financial, or family problems later.

I know, I know: “Call up a pro!” is another answer I give often when I’m answering retirement questions. But that’s because your finances, your retirement, and your legacy, are just too important. You’ve worked too long and too hard. You deserve the best advice on the things that matter most. I’m confident that whatever financial retirement planning questions you may have, my team at Keen Wealth can give you answers personalized to your specific situation.

Bill Keen on Retirement Questions ...

“If a potential investment sounds too good to be true, talk to your fiduciary advisor."

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About Bill

Bill Keen is a CHARTERED RETIREMENT PLANNING COUNSELOR℠ and independent financial advisor with more than 25 years of industry experience. As the founder and CEO of Keen Wealth Advisors, a registered investment advisory firm, he specializes in providing personalized retirement planning designed to help people thrive before and during their retirement years. With a passion for educating others, Bill regularly blogs about retirement planning, hosts the podcast Keen on Retirement, and has contributed to U.S. News and World Report, Reuters, Wall Street Journal’s Market Watch, Yahoo Finance, and other publications. Based in Overland Park, Kansas, Bill and his team work with clients throughout the greater Kansas City area and across the nation. To learn more, connect with him on LinkedIn or visit www.keenwealthadvisors.com.

KWMG, LLC’s dba Keen Wealth Advisors (“company”) is an SEC Registered Investment Advisor located in Overland Park, KS. The company and its representatives may only conduct business in those states where registered or where excluded/exempt or from licensure. For registration information please contact the SEC or the state securities regulators for the states where the company is notice filed. A copy of the company ADV is available upon request. Advisory services are only offered to clients or prospective clients where the company and its representatives are properly licensed or exempt from licensure. No advice may be rendered by the company unless a client service agreement is in place. This information is not intended to be investment advice or construed as a recommendation or endorsement of any particular investment or investment strategy and is for illustrative purposes only. Clients and prospective clients must consider all relevant risk factors involved with each strategy, including costs or fees, and their own personal financial situations before trading.

The views outlined in the book, Keen on Retirement Engineering the Second Half of Your Life, are those of the author and should not be construed as individualized or personalized investment advice. Any economic and/or performance information cited is historical and not indicative of future results. Economic forecasts set forth may not develop as predicted.

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