Enhance your Wealth & Avoid Retirement Pitfalls Rosemary and Larry were typical baby boomers. They longed TOP CONCERNS/RISKS STUDY OF 450 PROFESSIONALS for the carefree days of retirement. They worked hard, put their 32% Realizing safe tax efficient income through retirement children through college and had what they considered to 27% Maintaining good health and costs of healthcare be sufficient savings. Their financial advisor had done his job 21% Effect of taxes and inflation on retirement lifestyle to help them “accumulate” the wealth. Now it was time to look 13% Business continuity at those assets delivering an income to support their lifestyle. 7% Legacy planning They couldn’t understand why after all those years of saving it seemed as if they would fall short. They came to realize what the highest percentage of our personal study concluded. The “number,” on their brokerage statements wasn’t delivering on their true objectives. Safe, tax efficient income is what they desperately wanted. Yet they had not been exposed to the most current financial strategies to optimize cash flow and reduce income taxes through their lifetime. But what could they have done differently? Today they were paying $10’s of thousands of dollars in tax annually, which, by this point was limiting their capacity to save. And the plan never included selling equities at a 15 or 20% capital gains tax rate creating a lower base from which to generate fixed income. Only now in their early 60’s did they realize that the income tax on the growth in their portfolio was postponing their retirement dreams and their peace of mind.
What’s Left for Retirement Savings Net of Income Tax*
Compounded Savings* $1,000,000
$1,000,000
$900,000
$900,000
$800,000
$800,000
$700,000
$700,000
$600,000
$600,000
$500,000
$500,000
$400,000
$400,000
$300,000
$300,000
$200,000
$200,000 $100,000
$100,000
$0.00
$0.00 0
5
10
15
20
25
30
35
0
5
10
15
20
25
30
35
*Hypothetical example Componded Savings @6%; What’s left 35% realized tax rate 15% capital gains at year 30
HEALTHCARE COSTS DURING RETIREMENT
$250,000
$1,000,000
Current assets required for retirement What if?
The cost of healthcare through retirement was always on the back of their minds, yet again, their que sera sera attitude left them woefully unprepared. These two missed the impact of a transformation in healthcare. Some of the best physicians, sick of dealing with masses of insurance paperwork and ever decreasing reimbursements, have moved to “concierge medicine,” which doesn’t mean they’re giving you “extra special treatment.” Just “one bill—for everything at once—no insurance accepted.” For Rosemary and Larry it was easier to ignore it than to face it.
Many folks have a financial plan with assets accumulating based on the 30 year average of the S&P 500. We understand that your number should not be $1,000,000 or even $10,000,000. Rather, the plan should deliver an after tax cash flow for what you want, not just what you need… a plan which integrates your asset accumulation and your income tax liability is the key. Yet few plans account for this. The good news is that there are simple financial tools to enhance what you have and to mitigate many of these risks. We’d be honored to share those strategies with you. As you approach retirement, be more proactive than Rosemary and Larry… and happier and more secure!
Charlie Russ MBA CLU
®
Financial Advisor
Hunken Financial Group 225 W Wacker Dr., Ste. 400 | Chicago, IL 312.767.0256 charlie.russ@hunkenfinancial.com videos.thelivingbalancesheet.com/for-your-life
Hinsdale resident Charlie Russ has over 30 years working in the FORTUNE 500 and personal market place. Global responsibilities with Price Waterhouse and Ernst & Young along with a Kellogg MBA, and a Certified Life Underwriter (CLU®) certification from the American College are among his credentials.
Registered Representative of Park Avenue Securities LLC (PAS). OSJ: 2550 Compass Rd., Suite H, Glenview, IL 60026 (847-564-0123). Securities products offered through PAS, member FINRA, SIPC. Financial Representative of The Guardian Life Insurance Company of America® (Guardian), New York, NY. PAS is an indirect, wholly-owned subsidiary of Guardian. Hunken Financial Group is not an affiliate or subsidiary of PAS or Guardian.. CA Ins. Lic# OF700935. The study of 450 professionals is a personal study conducted over the professional career of Charlie Russ 2016-24409 Exp 06/18 Guardian, its subsidiaries, agents, and employees do not provide tax, legal, or accounting advice. Consult your tax, legal, or accounting professional regarding your individual situation. S&P 500 Index is a market index generally considered representative of the stock market as a whole. The index focuses on the large-cap segment of the U.S. equities market. Indices are unmanaged and one cannot invest directly in an index. Past performance is not a guarantee of future results.
74
HINSDALEMAGAZINE | Hinsdale60521.com