Since there is so much uncertainty right now, many are making predictions about where the economy is headed, when the virus will subside, and when we will return to “normal.” While no one can be sure, it’s worth considering the future when planning for it. If you’re nearing or entering retirement, a solid plan is even more important. Here are three tools to help survive hard times.
An Emergency Fund
First, assess your emergency fund, or create a plan to make one. Ideally, an emergency fund would cover all essential expenses for a few months. This could be necessary in the event of job loss, investment income loss, or an unexpected medical expense. An emergency fund may include a steady source of income, especially if you’re already retired. Without a pension to rely on, many retirees have the necessity of creating guaranteed income streams in retirement.
A Social Security Maximization Strategy
If you experience financial hardship, you might rethink your Social Security claiming strategy. The earliest you can claim Social Security benefits is age 62. However, claiming benefits before your full retirement age will result in a permanently smaller benefit. If you wait to claim past your full retirement age, your benefit will increase by 6 – 8% per year you defer until age 70.[1] If you think you need to claim earlier than you originally planned, keep in mind that you have one year after claiming to suspend benefits. You can repay your benefits within a year and go back into deferral.[2] This way, you can still receive a larger monthly benefit by delaying your Social Security benefits.
A Long-Term Investing Plan
Create a long-term investing plan, regardless of what’s happening in the here and now. Avoid making hasty decisions based on emotions, such as locking in your losses by pulling out of all your investments. Instead, you might review your asset allocations, reassess your risk tolerance, and consider your income needs now and in the future. Here are some dos and don’ts in a volatile market to consider if you’ve been concerned by recent market ups and downs.
You might be wondering when society, as well as your financial situation, will return to “normal.” Eventually, markets will rebound, but for those nearing and in retirement, this may not be soon enough. There will likely be other market drops in your lifetime, so consider planning for them. We can help you create a retirement plan that doesn’t overlook the possibility of hard times.
Carmichael Hill & Associates, Inc. is a U.S. Securities and Exchange Commission Registered Investment Advisory firm. Registration does not imply that the SEC has endorsed or approved the qualifications of Carmichael Hill or its respective representatives to provide any advisory services. Advisor does not render or offer to render personalized investment advice or financial planning advice through this medium. Advice can only be given after:
Delivery of a disclosure statement by advisor to client.
Execution of our Investment Advisory Agreement between the client and the advisor.
Initial payment of the planning fee or investment advisory fee by the client to the advisor.
Advisor will not solicit or accept business in any state in which she or he is not properly registered or otherwise qualified to conduct business by virtue of a state “de minimis” exemption.
DISCLAIMERS
The information in this web site is based on data gathered from what the Advisor believes are reliable sources. It is not guaranteed as to accuracy, and does not purport to be complete and is not intended as the primary basis for investment decisions. It should also not be construed as advice meeting the particular investment needs of any investor. The identification of specific funds and model portfolios is being made on the assumption that the investor would participate in that investment or portfolio on a long-term basis and only after consulting with their investment advisor to determine their needs and tolerance for risk. With respect to any such identification, there can be no assurance that the fund or model portfolio will in fact perform in the manner suggested.
The results do not represent actual trading due to the timing of the clients’ trades and their trading costs. They may also not reflect the impact that material economic and market factors might have had on the advisor’s decision making if the advisor were managing the clients’ money. Investment and portfolio results may be different than the results the advisor’s discretionary clients achieve due to the timing of trades and the market conditions.
All references that might be made to an investment or portfolio’s performance are based on historical data and one should not assume that this performance will continue in the future.
LINKS DISCLAIMER
At certain places on this Carmichael Hill & Associates, Inc. Internet site, live ‘‘links’ to other Internet addresses can be accessed. Such external Internet addresses contain information created, published, maintained, or otherwise posted by institutions or organizations independent of Carmichael Hill & Associates, Inc. CHA does not certify, endorse or control these external Internet addresses and does not guarantee or assume responsibility for the accuracy completeness, efficacy, timeliness, or correct sequencing of information located at such addresses. Use of any information obtained from such addresses is voluntary.
