5 Situations When You May Want To Pause Retirement Savings

Being Financially healthy throughout your journey to retirement is just as important as being financially healthy once you retire.

For that reason and inspired by a recent U.S. News and World Report article,1 let’s explore a few situations when it may make sense for you to stop saving for retirement — temporarily, of course.

This information is especially relevant for some people during the pandemic, but these ideas really apply anytime, whether the economy is up or down. And, to make it abundantly clear, these are all temporary situations that may make sense to pause retirement savings.

1| To rebound from a health crisis. During a health crisis it may be beneficial, or perhaps even essential, to pause saving for retirement. If you get slapped with medical expenses that your insurance company doesn’t cover, those bills have to paid out of your own pocket. And it’s safe to say that it doesn’t take long for healthcare bills to add up. If you have an ongoing relationship with a financial services professional, they’re going to be a go-to should you have a health crisis. They’ll be equipped to help you find ways to cover those dreaded out-of-pocket expenses without jeopardizing your future. If you aren’t working with a financial services professional, you may want to consider it.

2| To get rid of credit card debt. If you’re currently saddled with credit card debt large enough that you can’t pay it off each month, it may be a wise move to take a break from saving for retirement so that you can get rid of your credit card debt once and for all. As the article notes, the interest you’re paying on your credit cards may very well wipe out the gains you’re enjoying in your retirement strategy.1 That means getting your credit cards under control will have financial payoffs beyond just reducing your monthly expenses. Consider this: If you have a credit card balance with an interest rate of 17% and your retirement accounts are earning 8%, you’ve obviously got a gap that you’ll want to address as quickly as possible.

3| To cover unexpected unemployment. Losing your job is a terrifying prospect and if you find yourself in that position, you’re entitled to take the necessary steps to get through it. If you or your spouse is temporarily out of a job, you can use the money you were dedicating to retirement to cover household expenses. Then, when your employment situation stabilizes, you can get right back to socking money away for retirement.

4| To save to buy a home. Using the money you were dedicating to retirement to save up a larger down payment or to cover closing costs may be an appropriate financial move that could help you build equity faster in a long-term asset — your home.

5| To build an emergency fund. Having enough cash saved to cover unforeseen expenses is critical and many experts recommend having enough money to cover your expenses for six months to a year.1 A great thing about pausing for an emergency fund is that it has a clear endpoint. If you need to save $8,000, you know how to get there, and once you hit that number, you can pivot right back to bulking up your retirement savings.

Your financial health on your journey to and through retirement is important. Contact a financial services professional if you’d like some suggestions on ways you can stay financially healthy.

1 https://money.usnews.com/money/retirement/401ks/articles/times-to-stop-saving-for-retirement

What To Do When Retirement Is Right Around The Corner

If you’re like many people, the majority of your retirement strategy has been in planning and doing over decades. But what about when you’re almost ready to retire? Your strategy is likely to change.

Here are some things that you can keep in mind if your retirement is literally right around the corner, thanks to an article from the Motley Fool.1

One step is to make sure you take advantage of your flexible spending account (FSA) right up until you retire.

Remember, in 2020 you could funnel $2,750 in pre-tax dollars1 into your FSA and that number stayed steady in 2021.2

That money can be used for things like glasses, visits to the dentist, some medications, and doctor visits. Of course, if you don’t use the money in your FSA, you lose it.

Health savings accounts (HSAs) may be an even stronger play because the money you put into them doesn’t get forfeited.1 They can remain in your account and withdrawn without a penalty. You should note however, that the money you withdraw does become taxable income.

The 2021 HSA contribution limit is $3,600 for individuals and $7,200 for families.3 Also, people who are 55 and older can kick-in another $1,000.

When it comes to organizing your healthcare right before you retire, it’s also critical to have a thorough understanding of Medicare because there are plenty of options and nuances. Healthcare, especially Medicare, is a reason to meet with an experienced financial services professional who can help you make healthcare decisions that fit into your broader financial and retirement strategies.

Another thing to make sure you’re considering before you retire is inflation. You’ll want to make sure that you factor inflation into your savings goal to make sure your money is working just as hard for you 10 years into your retirement as it was on the day you retired.

Finally, it’s no secret that Social Security is an essential part of retirement for millions of Americans. Therefore, it’s important to understand what you’re likely to receive, when you should file, and ways you may be to increase your monthly payment.

Currently, the average monthly Social Security check is $1,478, which equates to $17,700 per year.1 You don’t need to have an economics degree to know that’s not going to come close to covering an extravagant retirement lifestyle. But remember, that’s just the average. If you were a high earner, your monthly check will be higher. And the current maximum monthly check is $2,788, good for $33,500 annually.1

If you don’t already have a clear idea of what your monthly benefit will be, you can visit the Social Security Administration’s website, at ssa.gov and set up an account to do so. One note here: The Social Security formula used to tabulate your monthly check considers your 35 highest-earning years. That means if you’re currently earning more than you ever have, and you like your job, you may want to at least consider working for another year or two because it will drive up your eventual Social Security payment.

There are many factors that you’ll want to consider before you make the leap into retirement. A financial services professional can help you. But most of all — congratulations! You have worked for years to reach this moment.


Enjoy it.






Simple Fixes That Can Improve Your Financial Situation Today

Finances are complicated. But these quick fixes aren’t.

Here are some ideas that you can implement — without a massive time investment or lifestyle change — and get results.1

Review your credit card statements. That doesn’t mean a quick once-over. You should sit down and spend some time analyzing what you’ve been purchasing. If you’re like nearly every other American, you’ve made some unnecessary or impulsive purchases. Don’t beat yourself up about this, because it happens to almost everyone. By taking the time to go through your credit card statements, you reduce the risk of forgetting a purchase or repeating the same purchasing mistakes in the future.

Look at your tax return. Tighten up your finances by looking at your tax return. If you’re getting a big tax return each year, you may want to consider adjusting your withholdings. This is an area where it might make a lot of sense to work with a financial services professional. They’ll have the experience to help you make tax and overall financial decisions that are going to be beneficial.


Bundle your insurance. You may be able to streamline your finances and keep a few more bucks in your pocket each month by putting all your insurance eggs in one basket. Working with one company for your home, auto and other insurance products may improve your rates. And let’s face it, the more business you do with one company, the better they’re likely to treat you. If you aren’t getting what you consider a fair rate, don’t hesitate to shop around. You only have to reduce your monthly payment by about $83 a month to save $1,000 annually — that’s real savings you could find in a hurry.

Reduce your entertainment spending. Many people can benefit from a quick call to the cable company to lower their rate. In a world where cord-cutting is becoming increasingly common, cable companies are going to play ball when it comes to keeping your business. Like with your insurance savings, don’t focus on what you’re saving per month; focus on what that monthly savings means over the course of a year or even longer.

Get a copy of your credit report.  Look it over closely and make sure all of your reported debt is accurate and that you don’t have anything outstanding that you’ve forgotten about. Your credit score is a valuable way to get a sense of your current financial standing. While it can take a long time to make a major change on your credit score, doing something today can have immediate results in turning it around.

Develop a strategy to eliminate debt. We all know that it can take a while to eliminate debt. But developing a plan to get there doesn’t take as long. Putting in place a strategy for debt elimination and improving your credit score is an excellent reason to meet with a financial services professional. A financial services professional will also be able to explain how your current financial habits and credit score may be affecting your ability to adequately prepare for retirement.

Take a moment to do one or more of these things today — you’ll thank yourself later.

1 https://money.usnews.com/money/personal-finance/slideshows/25-ways-to-fix-your-finances-fast

Get the Last Five Years Before Retirement Right

We spend decades working our way toward retirement. The accumulation phase, when we’re gathering wealth before retirement, is generally considered to be decades long. But every stretch is important, including the five years right before you retire.

The truth is the last five years before retirement requires a different strategy and adjustments to match. Those last five years are, to borrow a cliché, the home stretch and you certainly want to turn into that home stretch with confidence.

When you’re in your 20s and 30s, retirement is something of an abstract concept. You know it’s out there, but you don’t really spend a lot of time thinking about it. But when you reach your late 50s or early 60s, you realized it’s real and it’s coming fast.1

In those later years, you can ask yourself a series of important questions: Have I socked enough money away? Have I worked with a financial services professional to discuss investments and allocations? Am I prepared to pay for long-term care costs? Should I consider a trust? Should I prioritize paying off my mortgage? Is my 401(k) going to provide me with enough retirement income?

The answers to those questions will help you address challenges in your last years before retirement. First, you’ll want to get a complete understanding of where you are financially at that time. You can take some time to assess how your money is allocated in terms of retirement accounts and investments, and your expected Social Security income and strategy.

And then there’s the most important question of all: When you combine all of these potential income sources, will they create a pot big enough to allow you to maintain your current or preferred lifestyle?

If you aren’t sure you’re as ready as you should be for retirement, it can make a lot of sense to work with a financial services professional. Chances are there’s an experienced pro in your community who can answer your questions, analyze your current strategy, offer suggestions and perhaps most importantly, calm your nerves.

And don’t forget that if you’re still five years away from retirement, there’s likely still time to adjust your allocations, how much you’re saving, and your tax strategies.

Another important question you should ask yourself is what you want your retirement to look like. Does your imagination wander to relaxing afternoons reading a book on the beach, or are guided tours through the great European sites and museums more your cup of tea? Or, maybe your preferred retirement isn’t so much grand adventures as it is time with your children and grandchildren without the worries and burdens of work.

You can start to make a plan for where you want to be, and where you want to go when you have a clearer picture of that in your head.

Finally, the last question you’ll want to ask yourself is if the timing is right. Everyone has a different vision for when they’ll retire. Some common ages are:

  • Age 59 ½, which is when you can begin avoiding penalties on withdrawals from retirement plans
  • Age 62, which is when you first become eligible for Social Security
  • And age 65, which is when you become eligible for Medicare

If you retire before you turn 65, you’ll want to have a plan for how you’ll get health insurance. This is no small consideration. No matter the option you choose, it’s imperative to have adequate insurance when you retire.

You spend so much of your working life working toward retirement. Make sure you nail the last five years so you can head into retirement on a high note.



Don’t Overlook Legacy Planning

You have to be willing to get a little dark to talk about legacy planning. But the sooner you do, the better off you may be.

The lack of a legacy plan can cause chaos and stress for the people who survive us. This topic was the subject of a recent article from Investopedia, “Estate Planning: 16 Things to Do Before You Die.”1 The article paints a clear picture of what you should do to make your passing easier on the people you care about. A few of the key points are highlighted here.

A good place to start is to itemize your possessions. Grab a piece of paper and conduct a thorough inside and outside tour of your home to create a comprehensive inventory of all your valuable possessions.

The lack of a legacy plan can cause chaos and stress for the people who survive us. This topic was the subject of a recent article from Investopedia, “Estate Planning: 16 Things to Do Before You Die.”1 The article paints a clear picture of what you should do to make your passing easier on the people you care about. A few of the key points are highlighted here.

A good place to start is to itemize your possessions. Grab a piece of paper and conduct a thorough inside and outside tour of your home to create a comprehensive inventory of all your valuable possessions.

The lack of a legacy plan can cause chaos and stress for the people who survive us. This topic was the subject of a recent article from Investopedia, “Estate Planning: 16 Things to Do Before You Die.”1 The article paints a clear picture of what you should do to make your passing easier on the people you care about. A few of the key points are highlighted here.

A good place to start is to itemize your possessions. Grab a piece of paper and conduct a thorough inside and outside tour of your home to create a comprehensive inventory of all your valuable possessions.


Preparing for Retirement as a Couple

It may seem obvious that preparing for retirement as a couple is a good idea, but you’d be surprised at how easy it is to miss key components.


If you have a spouse or partner that you’ll be spending retirement with, you’re going to need to do a lot of planning. There are houses, kids, vacation funds, college funds, and inheritances to think about. Certainly, planning around those kinds of topics would have to be done together.


One guide suggests starting by outlining your big-picture goals together.1 Obviously, each member of a couple is going to have a few things that are very important to them but getting on the same page about goals will make the rest of the planning process easier. 

These conversations about the future are very important because they may lead to some surprising revelations. For example, one spouse may dream about retiring as early as possible while the other partner may be happy with their work and would like to continue with it for years into the future.


Or, in another scenario, one spouse may dream about a tidy beachfront condo with a balcony while the other partner may be set on the idea of taking an RV tour of all America’s beautiful national parks. The quicker each spouse spells out their ideal retirement, the sooner you can begin designing a retirement strategy that considers the kind of retirement you both want.


Another step in preparing for retirement as a couple is saving money together. In broad terms, each person is responsible for their retirement, and if both you and your spouse are working you may both have retirement accounts through your employers. Every couple is different, but it can be helpful to approach retirement preparation just like how you make financial decisions about things like buying a home or a car with your spouse. It probably makes sense for you to make savings decisions together.


That may involve contributing different amounts to each spouse’s 401(k), IRA contributions, and other decisions. Of course, another factor that may apply to couples is if one partner does not work outside of the home.

Of course, another factor that may apply to couples is if one partner does not work outside of the home. If that’s your situation, a spousal IRA may be a good way to go because it allows you to set aside funds in a tax-deferred account for the benefit of the unemployed spouse.


Strategizing when each spouse will claim their Social Security benefit is another very important thing that couples should do. Married couples are in a prime position to maximize lifetime Social Security income by carefully timing their individual and spousal claims. This planning element is dependent on you, your age, the age of your claim, and your spouse.


Beginning your planning several years before turning 62 — the earliest age that you can begin collecting Social Security — can make a tremendous difference for your retirement finances.


It might be beneficial to enlist the help of a financial service professional to help you identify more of the things you can consider as a couple. The most important part of going on a journey together may be preparing for that journey together.


Keeping your spouse or partner in mind during the preparation phase is a great way to do that.


1 https://www.thebalance.com/how-to-plan-for-retirement-as-a-couple-2894387

Life Insurance Basics You Should Know

Many people use life insurance as a safety net that will allow family members to pay bills, go to college, or support a business in case of the insured’s untimely death.


Ultimately, the thinking is, if you’re the beneficiary on a life insurance policy, you could have some degree of protection for your financial future.


Life insurance is a topic that you may feel you know at least a little bit about, but if you’re like many people, once you dig a bit below the surface you can encounter some things that are a little more complicated. A recent Forbes article, “10 things life insurance beneficiaries should know”1 shared some things that may be beneficial for beneficiaries to know.

One of the first things a beneficiary should know is that they don’t need a physical copy of the policy to make a claim. This is an especially important point because after someone you care about has died, the last thing you need is the stress of trying to track down life insurance paperwork. After all, many people typically purchase a life insurance policy years before their passing, which just increases the likelihood of a policy getting lost in the shuffle. 


If you’re the beneficiary of a life insurance policy, you only need to know the name of the life insurance company. From there, you can reach out and inform them that a customer has died, and then they’ll provide you with a claim form. 


While you won’t need the actual policy to file a claim, you will need to provide the life insurance company with a certified copy of the policyholder’s death certificate. Once you have the claim form, you should attach the death certificate to it. From there, you’ll be ready to submit the necessary paperwork to make your claim.


Another thing that beneficiaries should bear in mind is that a life insurance payout is tax-free. You read that right: Life insurance benefits are tax-free for the designated beneficiary, no matter how large the payout amount is. You don’t have to report life insurance proceeds as income unless the policy was transferred to you for cash or other “valuable consideration,” which does not apply to most beneficiaries.1

There are several different types of life insurance policies, which leads to another of the basics you’ll want to keep in mind: It’s possible that a beneficiary might not get the full policy face amount. If the policy was a cash value life insurance policy, and the policy’s owner took withdrawals against the cash value or loans that weren’t paid back, the life insurance company will reduce the payout amount accordingly.1

Let’s say the policy in question had a face value of $1 million, but the policy owner took a $50,000 loan from cash value and neglected to pay it back before their death. The life insurance payout will be reduced accordingly by $50,000, plus any loan interest. And, since a beneficiary may not even know about the policy, let alone the policy’s owner’s actions, this might come as quite a surprise.

That’s just one example of how the specifics of a life insurance policy can impact the beneficiary’s payout. If you’re unsure about your life insurance policy or you want someone to walk you through your options, it can be a great idea to start with a financial services professional.


Life insurance policies can be part of a wide-ranging retirement strategy that keeps your legacy in mind.


1 https://www.forbes.com/sites/advisor/2020/06/26/10-things-life-insurance-beneficiaries-should-know/


Please keep in mind that life insurance typically requires health underwriting and, in many instances, financial underwriting.  Guarantees are backed by the financial strength and claims-paying ability of the issuing insurance company.

Do Your Best to Avoid Common Retirement Mistakes

One of the secrets about building a retirement strategy that will help you reach your goals in retirement is avoiding common mistakes. It can be difficult because there are a lot of them. But avoiding those mistakes will help you feel confident that your finances will see you through your retirement and potentially even leave a legacy for your heirs.

One of the very first things you can do to avoid common retirement mistakes is to start saving right now. Every dollar you save today continues to potentially grow until you retire. As much as possible, cut back your spending a bit and put that money into your savings, because the payoff when you retire could be considerable.

Another mistake is not documenting your strategy to achieve your goals. A strong and wide-ranging financial strategy that factors your life expectancy, planned retirement age, where you’d like to live, your general health and your preferred retirement lifestyle can keep you focused and on track to the kind of retirement you truly aspire to.1

Just simply working can help you avoid another mistake: quitting your job too early. Many people leave a job without realizing they’re walking away from money in the form of employer contributions to their 401(k), profit-sharing, or stock options. And speaking of those contributions, you may want to consider maxing out your company match. If your employer offers a 401(k), sign up as soon as possible and make sure you’re maximizing the amount of money you contribute because that will allow you to enjoy a full employer match if one’s offered.

If your employer doesn’t provide a 401(k), consider a traditional or Roth IRA.

The next common retirement strategy mistake is investing unwisely, some people are comfortable with a self-directed investing approach because of the flexibility of choices it provides them.

Self-directed investing isn’t necessarily a bad thing, as long as you have the willpower to avoid biting on those “can’t-miss” stock tips that, in reality, might be pretty risky.1

As you get further into your journey toward retirement, it can be easy to fall into the trap of not rebalancing your portfolio. It can be a good idea to look at your portfolio on an annual or quarterly basis to make sure your asset mix is still performing.1 And, when we’re faced with the kind of economy we are right now, having someone to keep a keen eye on your portfolio is even more important.

And, the closer you are to that date when you can push away from your desk and call it a career, the more important it may become to review your portfolio allocation. Of course, that all depends on your unique journey to retirement.

Working with a financial service professional can potentially help you identify and avoid mistakes on unique to your journey to retirement.




Steps to Get Your Financial Life in Order

We all want to feel like our lives are in order, and that is especially apparent when things like the coronavirus show us how little we can control.

One thing you can control, however, is improving your financial situation. That was the subject of a recent article on thebalance.com.1 The following highlights the steps noted in the article to help obtain financial order.

The first thing you need to do when it comes to getting your finances in order is to do a thorough examination of where your finances are at right now. Calculate your net worth by comparing your assets against your liabilities.

Assets are things like bank accounts, stocks, mutual funds, retirement accounts, and real estate. Don’t include your home or your automobile in your assets unless you’re planning to sell them. Conversely, your liabilities are your credit cards and other debts. Don’t include your mortgage in this category unless it was included in your assets.

It should only serve as a reminder to bring a little more order to your overall financial plan. With that in mind, you can set financial goals. Drafting a list of real goals and then having the discipline it takes to meet them is a powerful financial step. If you’re one of the millions of Americans whose net worth is at zero or is negative, perhaps your goal should be to get out of debt as quickly as possible. By spending less and getting out of debt, you open a whole new financial world for yourself.

We can’t truly understand our financial habits until we craft a comprehensive budget. Start by listing your income and expenses. Compare a handful of months to see where you’re consistently spending your money. Then simply subtract your expenses from your income. What do you find?

If the amount is negative, or simply too close for comfort, consider ways you might be able to cut back on your spending. If you’re left with a number that’s comfortably in positive territory, you might consider building a budget that helps you continue spending appropriately, including additional dollars earmarked for retirement purposes. The zero-based budget, which gives every dollar a task each month, is a good system.

Getting out of debt is something that many Americans should consider. But the idea of really attacking debt can seem daunting. For many people, it’s like staring up at a mountain you know you must climb. But once you’ve climbed it and gotten to the other side, you’ll be enjoying a whole new financial life.

No matter how much debt you’re currently carrying, you probably want to pay off high-interest debt as quickly as possible. Interest can slowly choke the life out of even the best designed financial strategies. For example, someone with a substantial credit card debt could very likely be paying more each month in interest than they’re making on their investments. Ultimately, that’s unsustainable.

All of this may help you get closer to arguably the most important step: saving money. You could make a strong case that nothing secures your finances better than diligently saving money. That could be in an emergency fund for unexpected short-term needs, or retirement accounts for long-term income. By saving money now, you’ll better position yourself to address things like future home and auto down payments, a child’s college tuition, or unexpected expenses and investment opportunities.

Taking control of little things can make you feel better about the big things. Contact your financial services professional to learn more about how you can take control of your financial picture.


1 https://www.thebalance.com/plan-to-turn-around-your-finances-4119172

How to Avoid Social Security Scams

You’ve worked too hard for your money over the years to lose it to scammers.

But, unfortunately, Americans lost almost $153 million to scammers impersonating government agencies in 2019, and more than $37 million to Social Security-specific scams.

These are people like you, your neighbors, friends and family. These are parents and grandparents, who presumably have a limited amount of money for their retirement and the legacy that they hope to leave behind for their families. The scams have become common enough that the Social Security Administration is speaking out to help people identify scams.

The Social Security Administration wanted to point a few things out in addition to drawing attention to scams. First, if you receive an unsolicited call from someone who says they’re with the Social Security Administration, chances are they’re not. Many of us have received these calls already, or know someone who has, and some scammers are more believable than others.

In addition to the Social Security Administration cracking down on scammers, the United States Department of Justice has done its part to help by bringing civil actions against any telecommunications companies that have knowingly allowed scam phone calls to be passed along.

That crackdown has made an impact. But regardless of the changes, the bad news is that the bad guys are quick to adapt. For instance, when the government has made it harder for scammers to robo-call unsuspecting Americans, they switched to text messages to continue the scam. On top of that, the Social Security Administration is even seeing emails that use official-looking documents to lure people in.

At the end of the day, it seems like if there’s a way to communicate with you, these scammers will try to take advantage of it. That’s why it’s so important for people to be aware of scammers. Even people who think they’re taking the right amount of precaution can be deceived.

It’s easy to understand why when it comes to Social Security. People are rightfully emotional about Social Security and susceptible to scams related to it. Social Security is a vital component to so many Americans’ retirement strategies, and when threatened with the prospect of Social Security going away, many people lose sight of the potential scam.

The best way to sniff out potential Social Security scams is to consider how the caller contacted you and if you initiated the contact. According to the Social Security Administration, a phone call that you didn’t initiate is the very first and most obvious sign that you are dealing with a scammer. These phone calls can be very convincing, and scammers can use software that even makes it look like the call is coming from the official number of the Social Security Administration.

If you are concerned that you may have been targeted, the Social Security Administration launched a hotline for people to be able to easily report scams, and there’s also a website. You can call 800.269.0271 or visit oig.ssa.gov to alert them about potential scams. The money you earned and put away for retirement is yours — make sure your careful with it and vigilant about scams so it doesn’t end up in someone else’s hands.