Whether you are a Millennial or a Millennial family with children, sending a child to college, have a special needs child or someone who has taken a traditional approach to financial planning, there is a plan that can be structured to meet your needs.
Michael A. Ryan of Ryan and Associates, a financial planning professional, assists his clients with Social Security and Retirement needs; he specializes in Special Needs and College Bound Families.
Mr. Ryan states financial and retirement planning should be a “needs based approach” and you “have to help people find what works for them, even when things change in their lives.” It is never too late or too early to plan for the future. “Planning ahead are goals many families have, but are not sure how to put it in place.” That is why financial planning is a “human business”, he adds. “There is no generational cap to wanting to plan for the future.“
In a March 2011, PlanSponsor article of a study conducted by the Center for Retirement Research, entitled “Tailored Retirement Advice Leads to More Reasonable Plans”, gives a look at statistics based on pre-retiree responses to customized retirement advice. “After receiving advice on the tradeoff between working longer, saving more, and decreased retirement consumption, more than 40% decided to save more and/or work longer. About 25% reduced their planned increase in working years, which CRR found to be an appropriate response because these respondents were overestimating the number of additional work years needed to counteract their financial losses.”
Social Security looming with forecasted issues, things can change. Ryan notes: “With respect to retirement, Social Security is the only guaranteed for life income and most folks take it at 62 years old and use it as part of their retirement plan. It doesn’t matter if you take it 62 or 70, the later you take it, the more benefit it is.”
Ryan says: “When it comes to financial planning, there is not a better time than today. I find that a lot of families now, young families with kids, are coming with the idea that they don’t want to have to wait for Social Security. Millennials are refreshing. They want to be in control of what happens to their healthcare and retirement planning now.”
In a July 26, 2017 USA Today article entitled Millennials may be far from retirement, but think ahead with 401(k), “About 82% of Millennials are contributing to their 401(k) plans”. Millennials are taking an active approach to retirement. “Employee account balances, contributions and rate increases all saw an average of about 20% growth compared to 2015, a reflection of the rising stock market.”
Life insurance is often looked at to ensure your family can bury you when you die. Ryan shares: “People look at life insurance because death is eminent. [We] look at life insurance as protection or death benefit and can be also used as a living benefit. There are policies that can provide income if you have an illness, supplement retirement, etc. Using life Insurance as a supplement…most without taxes or penalties. Life insurance policies need to be built so it can do what you need it to do. Properly structured life insurance policies can do more for you when you are alive than most people realize.”
Without creating a financial burden, there are ways to put a plan or rider in place that can help a family who need funds sooner. In a March 2015 Thinkadvisor.com article, “Godsends for clients: 3 life insurance policy living benefits”, access to these “accelerated” benefits are helpful to many families especially those dealing with LTC or terminal illness. “Offering life insurance policies with living benefits can be attractive to consumers on several levels.”
Financial planning can also be customized for the special needs family. Ryan adds, “Planning is important when it comes to special needs families. The services in the special needs arena, is similar to anything that is provided in any other family. The biggest thing is constructing and preparing a Special Needs Trust.” Ryan adds, “These trusts are a vehicle to ensure the special needs child will be taken care of in the event of the death of the parents.”
A Time November 2016 article entitled “Special Needs Families face Special Retirement Planning” noted, “Another key step is creation of a Special Needs Trust to receive assets on behalf of the disabled family member, managed by an appointed trustee. The trust can hold a mix of assets, including cash, an investment portfolio and life insurance.” Additionally, with the Achieving a Better Life Experience (ABLE) Act created in 2014, Congress created a saving opportunity for people with disabilities. The “law permits creation of ABLE tax-advantaged savings accounts that allow people with special needs to save up to $100,000.” Many “states have created ABLE accounts.”
In an article by CNBC, May 2017, “How to Balance College for your Kids Versus Retirement”, it’s a candid look at how parents want to fund their childrens’ education. “For most Americans, finding the right balance between helping your children and preparing for retirement is essential. Set clear limits on what help you can provide and stick to the plan.” There are resources available through many channels.
An important part to the college planning process is to use all available resources when planning. Ryan adds: “This is important because it is still a part of the [financial] planning process. We look at products like aid and scholarships out there that can be tapped into.”
Thinking about the future at any stage in one’s life is inevitable. Customizing one’s retirement to fit the needs of life is the key.
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