High Net Worth Retirement Planning: Why is Age 59½ a Crucial Milestone?

By Trilogy Financial

July 17, 2024

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As you approach age 59½, you’re nearing a significant milestone that brings new opportunities for your financial future. This age marks a turning point where the IRS allows you to withdraw from your retirement accounts without incurring penalties. At Trilogy Financial, we provide comprehensive High Net Worth Retirement Planning strategies tailored to your unique needs, helping you navigate this critical phase with confidence.

Understanding the Importance of Age 59½

Reaching the age of 59½ is a pivotal moment in your retirement journey for several reasons:

Penalty-Free Withdrawals: The IRS permits penalty-free withdrawals from retirement accounts, such as IRAs and 401(k)s, providing greater flexibility in managing your retirement funds.
Catch-Up Contributions: If you’re over 50, you can make additional contributions to your retirement accounts, helping to boost your savings significantly.
Approaching Social Security: You are within a few years of being eligible for Social Security benefits, allowing you to plan more effectively for your retirement income.

Building Your Retirement Savings

Despite the importance of saving for retirement, many Americans find themselves with insufficient funds. According to financial experts, you should aim to have at least $1 million in retirement savings to support a comfortable 30-year retirement. However, the reality is that many people have far less saved.

Strategies to Enhance Your Retirement Savings:

Catch-Up Contributions: If you’re 50 or older, you can contribute additional amounts to your retirement plans. For example, you can make $6,000 in catch-up contributions to 401(k) plans and $1,000 to IRAs annually.
Prioritize Saving Over Spending: Shift your focus from spending to saving, ensuring you allocate a portion of your income to retirement accounts at the beginning of each pay cycle.
Seek Professional Advice: An Executive Financial Planning advisor can provide personalized guidance to help you maximize your retirement savings and take advantage of all available options.

Staying Healthy in Your Golden Years

Maintaining good health is essential for enjoying a fulfilling retirement. As you age, your health needs change, and it’s important to stay proactive about your well-being.

Health Tips for Older Adults:

Regular Check-Ups: Keep up with medical appointments and screenings to catch potential health issues early.
Healthy Diet and Exercise: A balanced diet and regular physical activity can help maintain your vitality and reduce the risk of chronic diseases.
Mental Health: Staying socially active and engaged can improve your mental health and overall quality of life.

Seeking Professional Financial Advice

Navigating the complexities of retirement planning requires experienced guidance. At Trilogy Financial, we offer Customized Retirement Solutions and Private Wealth Services to help you pursue your financial goals. Our services include:

401K Asset Management

Investment Strategies for High-Net-Worth Individuals

Estate and Inheritance Planning

Life and Long-Term Care Insurance

Philanthropic Financial Planning

Our team of financial professionals is dedicated to helping you pursue financial independence and secure a comfortable retirement.

What might a Custom Retirement Solution include?

Multi-Generational Wealth Planning

Multi-Generational Wealth Planning is essential for ensuring that your financial legacy benefits future generations. This involves creating strategies that protect and grow your assets while considering the needs of your children and grandchildren.

Trust Fund Management

Trust Fund Management plays a critical role in managing and distributing your assets according to your wishes. This professional ensures that the trust operates smoothly and that beneficiaries receive their designated assets without delays or legal complications.

High-Net-Worth Tax Strategies

High-Net-Worth Tax Strategies are designed to minimize tax liabilities and maximize the growth of your wealth. Working with a knowledgeable tax advisor can help you implement these strategies effectively.

Customized Wealth Management Plans

Customized Wealth Management Plans provide tailored solutions to meet the unique needs of high-net-worth individuals. These plans consider your specific financial goals and circumstances, offering a personalized approach to managing your wealth.

Legacy Planning for High-Net-Worth Families

Legacy Planning for High-Net-Worth Families ensures that your wealth is transferred according to your wishes and provides for future generations. This includes creating comprehensive estate plans that address your family’s unique needs and goals.

The Takeaway –

Age 59½ marks an important milestone in your retirement planning journey. With the right strategies and professional guidance, you can optimize your retirement savings, navigate Social Security benefits, and maintain your health for a fulfilling retirement. At Trilogy Financial, we specialize in High Net Worth Retirement Planning, Executive Financial Planning, and Private Wealth Services, providing tailored solutions to meet your unique needs. Contact us today to discover how we can help you achieve your financial goals and enjoy a prosperous future.

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Ready to Amplify Your Wealth today?

If you're ready to elevate your financial planning with our professional team, we invite you to schedule a meeting with us. At Trilogy Financial Services, our advisors in Corona are dedicated to crafting personalized financial strategies that align with your unique goals. Don't wait to start your journey towards financial success:

Schedule a Meeting: Reach out to us to arrange a one-on-one consultation with our financial professionals.
Give Us a Call: Prefer a quick conversation? Feel free to give us a call to discuss your financial needs and how we can assist. Call Us To Get Started. (844) 356-4934

Schedule a No-Strings-Attached Portfolio Review today and embark on a path to financial success guided by professional advisors. For more information and to schedule your consultation, visit www.trilogyfs.com/yourmoneyamplified. With the right knowledge and professional guidance, the journey of investing becomes an exciting venture towards achieving financial security and growth. This way, you're not just dreaming of an ideal retirement but actively working towards making it a reality.

Today, conversations, screens, and ads on how the upcoming election will affect our economy and the American way of life are unavoidable. Naturally, we start to ponder how the outcome might impact our own financial independence. Since market forecasters and economic commentators ever really get it right only part of the time, formulating investment strategy based on “expert” prognostications and financial journalism routinely sets individual investors up for failure.

According to historical analysis, in 19 of the past 23 election years from 1928-2016, stock market returns were positive, no matter which party held office. In fact, during an election year, the S&P 500 has experienced an average return of 11.3%—data that demonstrably counters the stock market doom and gloom headline hysteria generated in the media.

While it is crucial not to be emotionally reactive, it is equally important to plan for economic changes that are realistically possible. Following an election, it is wise to assess how federal policies could impact your plan.

A few takeaways…

Separate your personal politics from your investment decision-making.
Remain calm and focused on your long-term plan: thoughtful planning plus sound decision-making matters.

During his First Inaugural Address, our 32^nd President reminded the nation that “the only thing we have to fear is fear itself.” If not kept in check, fear becomes a catalyst for rash decision-making which can impede your path to financial freedom. As always, I am here to talk things through with you, to listen, and to assuage your fear; that’s my job.

Retirement Planning Advice

The Way You’re Taking Your Social Security Payments May Be Hurting You

By Trilogy Financial

June 26, 2018

Created during the Great Depression as a retirement safety net, Social Security now covers an estimated 96% of Americans. These days, a record high of around 167 million people are working and paying into the system that provides benefits for over 63 million people. In fact, the majority of retirees get more than half of their income from Social Security. Security can be complicated to navigate at times, but since it’s so vital to your retirement income plan, it’s important to make wise decisions and create strategies first.

Delay Benefits

Social Security benefits are calculated using complex actuarial equations based on life expectancy and estimated rates of return. Deciding the best time for you to claim your benefits depends upon how you compare to the averages. As of today, a man turning 65 is expected to live until age 84.3 and a woman of 65 until age 86.6.

If based on your health and your family history of longevity, you believe you will live much longer than that, your overall lifetime benefit will be greater if you delay claiming your benefits to increase your benefit amount. If the opposite is true and you see little chance of making it into your mid 80’s, you would receive a greater lifetime benefit by taking it sooner, even though it is a smaller monthly payment.

Several helpful calculators are available on the Social Security Administration website. With the Retirement Estimator at www.socialsecurity.gov/estimator, most people can receive an estimate of their benefit based on their actual earnings record and manipulate the numbers to reflect different strategies. They also have Social Security Benefits Calculators that can be used to calculate future retirement benefits.

Research Investment Opportunities?

While it will differ for everyone, research from Fidelity shows that most people need to replace between 55% and 80% of their pre-retirement, pre-tax income after they stop If you are in a position where you will not be reliant on Social Security to cover your basic needs in retirement, you may be better off claiming early and investing your benefit amount in an effort to earn better rates of return. In this way, although you’d start with a smaller monthly payment, you may end up with more money than if you had waited to receive the Social Security Administration’s increased payment due to the growth from your investments.

Which Coordinate with Your Spouse

If you are married, you have the choice to receive your own benefit or a spousal benefit of50% of your spouse’s benefit. By coordinating properly, married couples can increase their total monthly benefits.

The Society of Actuaries recommends that the lower-earning spouse begins collecting benefits early while the higher-earning spouse waits as long as possible. That way, you can make use of the lower benefit while maximizing the higher benefit. In most situations, it is the husband with the greater benefit and the wife with the lower one. Women also tend to live longer than men. By following this strategy, you not only maximize the husband’s retirement benefit for use while he is alive, but it also maximizes the wife’s survivor benefit when he passes away.

Consider the Effect of Additional Income on YourBenefitsSubmit

Once you reach full retirement age (FRA), having earned income will have no effect on yourSocial Security benefit payments. However, if you begin receiving benefit payments before FRA, your earnings will decrease your payments.

Income Earned the Year You Reach FRA

The income restrictions change in the year in which you reach FRA. That year there is a higher limit; $45,360 for 2018. Once your income exceeds that limit, your Social Security benefit will be reduced by $1 for every $3 you earn. For example, if between January 1 and your birthday you earn $48,360, you have earned $3,000 more than the limit. That $3,000 excess will reduce your Social Security payments by $1,000. As soon as you have your birthday and reach FRA, though, there are no more limits. You can earn as much as you want and it has no effect on your Social Security retirement benefits.

Continuing to work into retirement may be beneficial even if your current benefits are reduced. If your income is within the top 35 years of your earnings, you will increase your aim, which is the average used to calculate your benefit. By continuing to pay into SocialSecurity as a worker, you can increase your retirement benefit even after you have begun collecting it.

Work with an Experienced Professional

A 2015 Voya Retire Ready Study found that those who consult a financial professional are more than twice as likely to have calculated how much income they need to live a rich life in retirement. Working with an experienced professional can help you navigate your SocialSecurity options and optimize your total lifetime benefit. If you have any questions or would like to see how Social Security will impact your retirement plan, I am here to help. Take the first step by reaching out to me for a complimentary consultation by calling (949) 221-8105 x 2128 or emailing michael.loo@trilogyfs.com.