Q: What do I do with my 401(k) now? I want to roll it over to an IRA but the markets are so wild and my balances are down.
A: First, congrats on your retirement!
Second, you don’t need to do anything right now. While I do not feel it is best to keep accounts where you are no longer working, doing nothing right now is the best decision. You can open up a rollover IRA so there is an account waiting for your funds. Assuming that you have a well diversified and allocated portfolio for someone ready to retire, you need to just sit tight until the turmoil is over.

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Prepping is a world unto its self. There is freeze-dried food, water purification systems or pellets, batteries, shelters, escape plans, protection, and most important in my book, toilet paper.
These people spend enormous amounts of time researching what they need to protect their families, how long you can survive on your own, and how to make sure no one else tries to take what you have worked so hard to stockpile. They really worry a lot about the Zombie Apocalypse, invaders from foreign lands, and anyone who has not prepped as they have.
But what if none of this happens? What if the Zombies never come? Have you “Prepped” for the biggest apocalypse that may occur? What is that you ask? Outliving your assets in retirement – that’s what I am worried about.
Too many of us put off dealing with the fact that one day our paychecks will end but our lives and expenses will not. Get a financial plan done now – be the best Prepper you can be for your own longevity.

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I know for many people, being called a conservative is the same as being sworn at. Relax – I am talking about calling yourself a conservative investor.
As we approach retirement, we need to get less aggressive with our investments. I contend that there is always a need to have equities in your portfolio, but you will also need income. I do not have a blanket recommendation for when to start moving your assets into a more conservative mix as every client has different means and needs in retirement, but there will be a time when this becomes necessary.
Please make sure you are keeping up with your portfolio review appointments so you will know when it is the proper time to call yourself a conservative is.

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There is a proposal to make state college free for everyone to the tune of $350 billion over the next 10 years. These expenses will be paid by the “most fortunate” among us. That is the term used – I am not sure who it applies to yet.
My daughter will be graduating from nursing school in December- my husband and I have paid for all of her schooling. We saved from the time she was born because we knew no one else would. Her schooling has been expensive, but worth it.
Will I be considered one of the “most fortunate” that now should pay for someone else’s college? I may fall into the group once it is defined. Let’s look at how ‘fortunate’ I have been. Side note- fortunate to me implies I have been lucky and given what I have.
I have been fortunate to have parents that allowed me to live with them when I was getting started in business. I have been fortunate that I have had good training and mentors. The rest is all on me. I have been self employed for 32 years. I work hard, a lot of hours in the office and out of the office; I take on great responsibility with my clients. I happen to love every aspect of my business.
I have also taken responsibility for the decisions and expenses in my life. I have not asked anyone else to pay for my daughter’s college or any of the expenses of life.
I realize some people have not been as “fortunate” as me; however, if those people have drive and ambition, there are other ways they can realize a college education.
I will gladly contribute to any number of charities, but this is my choice. DO not force me to pay for someone else’s college.

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Lately, it has been hard watching the markets. It seems as if we will never have an up day again. But there could be a hidden surprise in this downturn. I know that many of you watch your balances every day, a practice I do not recommend. when was the last time you really looked at your cost basis vs. the current market value? Do you have large long term gains that have made your portfolio off kilter? Many of my clients do but do not want to sell any of those gains and pay the associated tax. Now you have the opportunity to wipe out part of that capital gains tax.
Harvest some of your losses to offset the gains. If you have a few holdings that are in a capital loss position, you can sell the losses to off set the capital gains and rebalance your portfolio.
Remember to match long term gains to long term losses, and short term gains to short term losses.

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Last week my Father-in-law received a summons for jury duty. He would have loved the whole process of being on a jury, thoughtfully listening to everything said, then deciding the person’s fate with great reverence.
Here’s the problem; sadly, my Father-in-law passed away last December. When my husband called the county to let them know this, he was met with words of condolence. Quickly after the kind words from the clerk was a request of proof of his death. My husband told her politely to check her own counties records for his death certificate.
I have no words.

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Almost half of working Americans do not have a 401(k) available to them. This should not stop you from saving for your retirement. If you don’t – then who will? There are other options for retirement savings.

Traditional or Roth IRA:
If neither you nor your spouse has a corporate retirement plan, you can take advantage of a fully deductible Traditional IRA by depositing up to $5,500, or if you are over age 50, $6,500.
SEP IRA:
If you are self-employed, you can contribute up 25% of your net earnings or $53,000, whichever is less in 2015.
Solo 401(k):
If you are self-employed with no full time employees, you can contribute $18,000 or $24,000 if you are over age 50. Your spouse can also make a contribution if employed in your business.

No one is going to take care of your retirement for you. You owe it to yourself to make sure your retirement is everything you wish it to be.

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I have been asked to be a columnist for Seminole Magazine. Here is my latest article. Please feel free to subscribe – it is free.

http://seminolemagazine.com/food-for-thought

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Assumptions can be tricky and retirement assumptions can be a disaster. Here are a few things you do not want to assume in retirement:
A 4% withdrawal rate will ensure I don’t run out of money.
This is a rule that was introduced in 1994. In 1994, the average investment was earning 8%; a 4% withdrawal rate + inflation never put a dent in your principal. Over the last 10 years, we have seen that a consistent 8% annual growth rate cannot be counted on.

Spending always goes down in retirement.
This is the biggest eye-opener for many of my clients. We are all living longer, but not necessarily healthier. Health care is expensive. If you end up with Alzheimer’s or dementia, the costs can go through the roof.

I will remain married.
On average, 50% of first marriages end in divorce, the statistics are higher for second & third marriages. There is a wave of “gray” divorces, couples age 50 and up divorcing at a faster pace than in the past. Running two households, especially when you live on a fixed income, can be hard.

Don’t assume – plan for the unexpected.

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I met with a woman yesterday who was recently widowed. She received an insurance payout and felt she could invest it, but was not sure. She told me she had just met with two other financial planners, one had nothing to suggest but an indexed variable annuity. The other gave her an expense summary sheet to complete that consisted of 5 items, asked her what all of her sources of income were, told her she had enough income for the rest of her life, then showed her an indexed annuity.
Wow!
After spending some time getting to know her, I gave her our expense summary, which has about 40 items on it, a confidential profile, a risk questionnaire, and ask her to take some time completing her ‘homework.” When I have all of this date + investment information she left with me, I will complete a comprehensive plan that will take her through age 90, include some inflation, and many other items to determine what investment, if any, these dollars can go to.
Sales or planning – make sure you get what you really need to make life long financial decisions.

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