Turning “I Think I’m Ready” Into a Plan

One of the most common questions we hear from people approaching retirement is, “Do I have enough to retire?” It’s an important question, but on its own, it’s usually not specific enough.

You might have a million dollars saved, maybe two. You know approximately what Social Security will pay. You might have a pension too. You’ve done a great job saving for decades. But none of those numbers by themselves tell you whether you’re ready to retire.

At Kennedy Financial Group, we believe a retirement plan should start with something much more specific: a date and dollar specific retirement plan. In other words, when do you want to retire? How much will you need to live the retirement you want? And exactly where will that income come from?

That’s what we mean by Map Your Retirement Income, the first phase of our Guided Retirement Roadmap.

Start With the Life, Not the Portfolio

It can be tempting to start retirement planning by looking at your investment accounts. How much have I saved? What return am I earning? How should my portfolio be invested?

Those questions matter, but we believe they come second. First, we need to understand what your money needs to do for you.

That begins with your spending. What does it take to maintain your lifestyle each month? What expenses might disappear in retirement? Which ones might increase?

Just as importantly, what do you want your money to do? Maybe your retirement means traveling several times a year. Maybe there’s a second home in the plan, a kitchen renovation, a new vehicle, helping kids or grandkids, or even a bucket-list purchase you’ve been putting off.

We’re not just trying to determine what it costs to survive retirement. We want to understand what it costs to live the retirement you actually want.

Where Will Your Retirement Paycheck Come From?

Once we understand what you want to spend, the next question is simple: Where’s the money coming from?

During your working years, that answer is usually straightforward. A paycheck arrives every couple of weeks. Retirement is different.

We often explain retirement income with a simple three-legged stool: Social Security, pension income, and portfolio withdrawals. Not everybody has all three, but the concept helps. We want to identify each source and understand how they work together.

For example, if your desired lifestyle requires $10,000 per month and Social Security and pension income provide $6,000, we now know that the portfolio has another job to do. It needs to help provide the remaining $4,000 per month.

That gap becomes incredibly important because it begins to tell us how much you need from your investments and, eventually, how those investments should be structured.

Put a Date and a Dollar on It

There’s a big difference between saying, “I’d like to retire around 65,” and saying, “I want to retire in June 2029, and our plan shows what we need each month, where that income will come from, and how we’ll fund the larger things we want to do.”

The second one creates clarity. It also gives us something we can actually plan around.

Retirement will always contain unknowns. Markets change, tax laws change, inflation changes what things cost, and life will undoubtedly throw a few curveballs along the way. The goal isn’t to predict all of that perfectly. The goal is to begin with a clear map.

Before we decide how aggressively or conservatively your money should be invested, before we look at tax strategies, before we address the other important pieces, we first want to know: What does your money need to do?

That’s why Map Your Retirement Income is the starting point of our Guided Retirement Roadmap. Retirement shouldn’t begin with “I think I have enough.” It should begin with a plan for when you can retire, what it will cost, and where the money will come from.