“Sound financial decisions don’t involve who’s in the White House, although that can definitely impact you. What you always need is a good long-term strategy.”
Many Americans, who are nearing retirement, are becoming worried about their finances with the Trump administration. They may be concerned about their portfolio with stocks going up. The new president also has some people worrying about Medicaid and Medicare, the value of their home, their pensions and their tax exposure.
The Jewish News of Northern California says in a recent article, “Retirement planning in the Trump era: same as it ever was,” that folks need to slow down. Here are some guidelines to help secure soon-to be retirees’ finances now and through future administrations.
Don’t make an investment or personal finance decision based on politics. Your financial plan should drive decisions based on your needs, objectives, risk tolerance and financial values. It is designed for the long term, not in response to a political event.
Diversify your portfolio. It is recommended that you combine different asset classes, because they gain or lose value at different times based on changing economic factors. You can live with losses offset by gains that produce a long-term increase in the value of a well-planned portfolio. Separate asset classes are stocks, bonds, real estate and commodities.
Plan the funding of any lump-sum purchases. This could include a European vacation, a new car or a new home. You should look at how you’ll generate regular income. It’s okay to have some fun early in retirement, but keep in mind that you’ll need a sufficient and steady cash flow to replace your earned income.
Keep track of what you spend now and estimate your spending in retirement. Be prepared to reduce your lifestyle a bit, but you also may find yourself eliminating some expenses, which means more spendable income than you thought you’d have.
Analyze your retirement income and spending annually. Be sure that you’re on track and keep up with variables, such as market return and life expectancy.
Finally, if you’re married or have a life partner, be certain to have an up-to-date estate plan.
Reference: The Jewish News of Northern California (August 14, 2017) “Retirement planning in the Trump era: same as it ever was”