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Janice France-Pettit:Benefits of retirement-income evaluation

Union Bank of California

Posted: September 10, 2010 10:59 p.m.
Updated: September 11, 2010 4:30 a.m.

Preparing for your retirement can be an exciting time in your life. However, you may worry about having to fully rely on your retirement savings. In order to feel more confident that your nest egg will last throughout your lifetime, you may wish to review your retirement savings before you officially retire.

One way to make sure that you are on track for retirement is to have a retirement-income evaluation. This is a simple evaluation offered by financial institutions that will determine if you have enough savings to retire. Generally, people opt to have the evaluation when they are close to retirement age, but may do it sooner.

“There are smart ways to start preparing for retirement right now,” said John Loder, senior financial advisor, Union Bank Investment Services.  “Analyzing your retirement income today may help you make adjustments and give you peace of mind that you will have enough retirement income to pay for basic expenses or health care in the future.”

Make sure to identify a reputable financial advisor or retirement planner to conduct the evaluation. You may wish to check references or turn to your lender for a recommendation.

What to expect
The evaluation will assess your current retirement plan and project your future financial needs in order to make sure you will have enough money to maintain your current standard of living. You should receive a complete review of your retirement portfolio, as well as have the opportunity to ask questions and receive advice about necessary changes.

Evaluating portfolios
The evaluation will identify your retirement balance sheet including your assets, income and other expenses in order to estimate how much money you will need to retire. Through the evaluation, you can determine your portfolio’s strengths and weaknesses, and make adjustments in your current plan to optimize your retirement earnings. The evaluation will also compare your current retirement plan to expert recommendations based on whether your plan uses a conservative, moderate or aggressive growth strategy.

Your evaluation will project changing scenarios in the market, and how your portfolio will react to those changes. Based on the results of this projection, your adviser may present you with options such as increasing your retirement investment, delaying your retirement or allocating your funds differently to help close any gaps and minimize exposure.

Asset projections
Your financial adviser may be able to review scenarios based on strong, moderate and poor market conditions to learn how long your retirement savings will last and if you are at risk of having your nest egg depleted too quickly. You may be presented with options that can help you save more and spend less.

Evaluating future health care and insurance needs
Lastly, your evaluation will identify how much money you will need to cover your life, health and long-term care insurance. It will evaluate your projected needs and ensure you have enough money to cover the rising-cost of health care.

Your financial adviser should be someone you know and trust. Ask your banker for information on financial institutions that offer retirement-income evaluations. Taking the time to prepare for retirement may help you be less stressed when your retirement day finally arrives.

Janice France-Pettit is a senior vice president and regional manager for Union Bank, overseeing the Simi Valley, Santa Clarita Valley, San Fernando Valley and Antelope Valley region. The foregoing article is intended to provide general information about and is not considered financial or tax advice from Union Bank. Ms. France-Pettit’s column represents her own views, and not necessarily those of The Signal.


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