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Purpose Of Retirement Planning : Retirement Plan

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Purpose of Retirement Planning
When it comes to your financial life cycle, retirement is one of the most important and strenuous areas to plan for. Because of the reduction in income during retirement, a person is exposed to longevity risk (risk of outliving your money) and the risk of not being able to maintain your current or wanted lifestyle. Our Red River Wealth Management team has analyzed your financial information and goals to create the retirement recommendations listed below.

Areas of Improvement/Concern
Upon reviewing your goals and financial information, we are concerned with your exposure to longevity risk. If you continue on the path you are on now and try to reach each goal on your own, you will outlive your money. Along with the recommendations listed below, we believe it would be beneficial to save more in your brokerage account. These savings can come from cutting back on expenses as well as your surplus saved each year.

Explanation of Common Terms
Your average return is the average of all the returns on your investment over a certain period of time. This could be a monthly average return, yearly average return, all of retirement average return, etc.
Bad timing means that the markets are behaving poorly whether at the time of investment or sometime within the plan. This could be due to economic, social, political, environmental, or other conditions.

Retirement Goals
You expressed, in our introductory meeting, that Arthur would like to retire at the age of 67 and Martha would like to retire at the age of 64; however, you are somewhat willing to retire later if necessary to attain your goals. You also wish to maintain your current lifestyle, with a few changes in housing, travel, and vehicles. Base...

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...anation
A reverse mortgage is a loan for age 62 and older to use the equity in their home as a supplement for income. This loan is not paid off until you move out of your home or pass away. This type of mortgage is a great resource for those who need the extra cash in their daily lives; however, we would not recommend a reverse mortgage for your situation. There is a high probability that you can maintain your lifestyle and accomplish your goals without the risk of a reverse mortgage. However, if a need does arise and extra funds are needed, we can revisit this topic and see if it is necessary.

Resulting Probability to meet goals
If you choose to follow our recommendations, you will increase your probability of success from 33% to 84% which is within the Confidence Zone. Your probability of success is discussed in detail in the Investment section of this plan.
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