Financial Fitness: A Guide to Retirement Readiness

“A journey of a thousand miles begins with the first step.” —Lao-Tzu

“Faith is taking the first step even when you don’t see the whole staircase.” —Martin Luther King, Jr.

The common thread among the quotes from 6th century BC philosopher Lao-Tzu and modern-day Martin Luther King Jr. in the 1960s reminds us that achieving what we set out to becomes possible when we first imagine and then approach it with small, manageable and attainable accomplishments. Loosely translated, the goals you have in mind are indeed quite possible.

The steps below provide a skeletal framework for aligning your investment and savings habits with your financial goals for retirement. Whether or not you currently have a financial advisor, this list is for you.

1) Identify goals for the 
retirement you envision.

Think deeply about your ideal retirement. Do your goals include travel? Staying involved with your community? How much, if any, do you want to leave as an inheritance for your family?

Write these down to create a vision for your retirement. Remember, money alone may not bring you the maximum happiness, but a lifestyle that you have earned the right to enjoy through prudent planning and investment can.

To assist in this process, discuss your aspirations with a competent advisor—one that knows the pertinent questions to ask about how you intend to economically achieve and spend your days in retirement.

2) Determine and write out your expenses in retirement.

Go through each of your goals and determine the sum required to finance them. Identify current monthly expenditures; what are they in total? Will they increase or decrease? Will others appear or increase, like additional expenses for travel or medical costs?

In doing so, you’ll come up with an approximate dollar amount to attain before retirement.

3) Confer with your advisor to 
create a plan.

As with any goal, creating a definitive plan with identified timeframes is essential, including specific milestones along the way to track your success and progress. An experienced professional can objectively discuss the strengths and weaknesses of your plan, improve it and further educate you about investment options. There is no single solution or investment that can be applied to everyone’s investment portfolio. In fact, a personalized approach that assesses your various needs, from tax ramifications, time constraints to fund your goal, comfort with investment risk and volatility, all help determine the right blend of investments that may be the most effective for you. Once you have spoken with your advisor and clearly identified the goals, make the investment.

4) Take responsibility.

This is one of the most difficult things to do, but also the most important. Whether or not you have a financial advisor, you are the one who ultimately decides if you invest or procrastinate, or if your income outpaces spending. The actions you take today create your financial future.

5) Understand what your plan 
requires, and stay committed.

If you’re investing in real estate, be ready to put in the work. If you’re investing in the stock market, plan on your investment taking time to grow. Those who experience difficulty staying disciplined with their financial objectives may consider automatic investments as an option. Discuss this with your financial advisor. Regularly funding the retirement plans available to you is often a first step toward securing an income in retirement.

And remember, when you build that golden nest egg, don’t raid it! The investments you make and nourish now shape the trajectory of your financial future, so do your best not to dip into them prematurely.

Jeff Runyan is a resident of Malibu and financial advisor based in Beverly Hills, providing clients nationwide with wealth management and retirement planning advice, with over two decades of industry experience. As Chief Executive Manager of Runyan Capital Advisors, Jeff leads an investment team committed to designing investment portfolios that adhere to the premise, “Discipline Makes the Difference.” Learn more at RunyanCapital.com.

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