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Sound Advice: June 22, 2022

The Keys To Retirement 

Whether you are looking ahead to retirement or are already enjoying what we all hope to be a time to do what we find most enjoyable, it’s essential to ensure that you have sufficient financial resources to maintain your desired lifestyle.

But there’s more.  What will you do with your time?  Both of these issues require considerable attention.

The question of finances comes down to four critical elements: what you own, what you owe, what you’re earning, and what you’re spending.  It’s usually easy enough to figure out what you own and owe.  And it should be no more difficult to estimate your ongoing income.  The hitch, in more than a few cases, is getting a handle on what your expenses are and making a budget that accurately reflects the outflow.

For most people, the key assets are your investments and your residence.  There may also be vehicles, jewelry, collectibles, and the like.  At this stage in life, there may be a remnant of a mortgage and perhaps an auto loan or lease commitment.  There shouldn’t be other debts, but if there are it’s time for serious attention to getting rid of them.

Estimating income should be relatively straightforward.  Begin by adding up Social Security benefits, pensions (if any), and other ongoing income.  Then factor in a 4% or 5% return on investments, which assumes that you have a reasonably well diversified portfolio of holdings.  You should be able to withdraw at that rate on an ongoing basis.  If there is a possibility of nonrecurring income (sale of properties, inheritances, etc,), you can figure that in also.

And then there are the expenses.  For most people, there will be a dozen or two categories, which include a wide variety of fixed and variable outflows.  A good starting point for the details on this will be your checkbook and recent credit card statements.  In addition to obvious costs such as rent/mortgage payment, utilities, and telephone, make sure to include personal care, hired help, entertainment, dining out, vacations, charitable donations, and insurance.  The longer the list, the more likely your numbers will be helpful.

Then compare what’s going out with what’s coming in.  The numbers should be reasonably close.

If the finances are in order, the next question is:  What will you do with your time?  Some folks have so many interests, they’re rarin’ to go.  Others are not so fortunate and are bewildered by how to handle this next phase in life.

Best to plan to do what will be pleasing and hope for many years of good health.

N. Russell Wayne, CFP®

Sound Asset Management Inc.

Weston, CT  06883



Any questions?  Please contact me at




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