Many of my clients are people in their 70s who worry about maintaining their financial independence in retirement. If this is something you’re concerned about, here are a few tips to consider.
Diversification
As your portfolio grows, it’s natural for it to start skewing towards the riskier side. Your net worth may become overconcentrated in the stock market, which means you’re taking on too much risk without realizing it.
At this stage in life, you’ll likely want to find other investment tools that will make your portfolio more conservative. Bonds and CDs (FDIC insured Certificates of Deposit), for example, have different risks associated with them but are generally considered safer than stocks.
Income
Ask yourself, “Where is my money coming from?” Perhaps you receive a pension, Social Security, or dividends from stocks. By reviewing all income sources with a financial advisor, you can determine if you’re drawing income in a sustainable and tax-efficient way.
Family
While a financial advisor can help you make decisions and manage your wealth, it’s still important to involve your children or other trusted family members — especially if your abilities begin to decline or you want to prepare for a situation where you may not be able to deal with financial responsibilities. Establish a durable power of attorney to handle your financial and medical matters in the event you’re unable to make sound decisions on your own.
Emergency Fund
As a good rule of thumb, maintain an emergency fund that’s able to cover three to six months’ worth of expenses. In addition to an emergency fund, your portfolio should also be able to cover surprise medical expenses. While Israel has a fairly robust socialized healthcare system, not every expense will be covered.
Having a trusted advisor is important as you strive to maintain financial independence in retirement. Having a financial professional on your side doesn’t minimize your involvement, but provides additional support so you can continue to feel confident about your financial well-being. Call our office today to learn how we can help you open and maintain U.S. investment accounts overseas to fund your retirement lifestyle.
Douglas Goldstein, CFP®, GFP®, is the director of Profile Investment Services, Ltd. www.Profile-Financial.com He is a licensed financial professional both in the U.S. and Israel. Call (02) 624-2788 for a consultation on how to set up your American assets to meet your financial goals. Securities offered through Portfolio Resources Group, Inc. Member FINRA, SIPC, MSRB, FSI. The opinions expressed are those of the author and not those of Portfolio Resources Group, Inc. or its affiliates. Neither PRG nor its affiliates give tax or legal advice.
Published January 10, 2024.