Retirement Strategy: When and How to Update Your Retirement Plan

Melissa N. Osika, MBA

While you and your trusted retirement professional will work to create an overall retirement strategy, this does not mean that you won't need to make changes along the way.

So, the question remains: When should you revisit your retirement strategy?

First off, when you've had a major change in your career, that's a good time to talk about your strategy. That change can be getting a new job, quitting, or being laid off. It can also be a promotion or a raise. Whether or not you've had a change in your main job, starting or selling a business enterprise is another cause for conversation.

Situations in which there's been a major change in your or your family's lives are good times to reconnect with your financial professional. Essentially, these events are situations in which your beneficiaries might change. These include marriages, divorces, births, and deaths. Not all these circumstances are life and death; it could be as simple (or complicated) as moving to another state, country, or even just up the street. If one of your family members has become a caregiver, this could be an important conversation starter. Some conversations will happen at set times, such as when you or your spouse turn the key ages of 59, 65, and 70½. Another time to notify your trusted financial professional is if your health has deteriorated; this includes mental and emotional health.

Many of these conversation-worthy situations are financial in nature. For example, if your risk capacity has changed. What does that mean? It means a change in your ability to weather a financial risk, such as having more cash or wealth at your disposal through some sort of windfall. This can also go in the other direction if you experience a considerable loss. Another consideration is whether the value of your assets has changed, altering your wealth profile for good or for ill. How about gifting, whether within your family or to a charity? A significant gift, such as a philanthropic endeavor, would be a reason to look at your strategy. Have you purchased or sold a major asset on the level of a house or business? How about a major change to your debt profile, whether it's an increase or a decrease? It can even be as simple as having a major change of mind about your estate strategy, including changing beneficiaries or altering gifts you intend for charities and other entities.

There are other reasons to take another look at your financial strategy that may have nothing to do with your financial situation directly but instead relate to outside factors. A major change in tax policy or law is one example. Maybe you've made some changes to your legal and financial team or plan to name a different executor to your will. Perhaps you've had a change in your household that has upsized or downsized your lifestyle. Or maybe you've had a major mishap, like misplacing or losing important documents.

Finally, there's always the possibility that it's been a year or two and it's just time to look over your strategy and see if there's anything that needs your attention.

Whatever the reason, big or small, your trusted financial professional will be more than happy to help you through whatever concern or transition you're facing.

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