By Matthew Marcoux, CFP® / December 28th, 2020
Outliving Your Money – Live Plan
One of the greatest retirement fears people have is outliving their money. Rather than focus on the fear, let’s focus on making sure that doesn’t happen. Here are a few tips:
Have a live financial plan. Gone are the days of hard copy, printed financial plans, organized neatly by your financial planner in a three-ring binder. Live financial plans allow us to see how daily market changes are affecting your whole portfolio, providing us an opportunity to make adjustments more quickly and frequently, ensuring a greater probability of success.
Stick to the plan. Certainly it’s important to make adjustments when needed, but consistency is key. Let’s come up with a plan you can stick to.
Build contingencies into your plan. Though we advocate for positivity, the reality is, planning for unexpected events is critical to your ability to remain committed to the plan. Consider modeling out a declining market, a major illness, or significant expense you may incur.
Live within your means. Don’t spend what you don’t have.
Include variety in your plan, We talk often about the importance of having three buckets of money: long-term aggressive, moderate intermediate, and short-term very conservative. Spreading your money through different buckets will contribute to long-term success.
Most importantly of all, enjoy the ride. None of us knows how long we have, so you might as well have some fun along the way.