14 Tips From Financial Sages That Seniors Need To Know (Part 1)

14 Tips from Financial Sages

This month, we asked nearly 200 financial advisers what they thought was the most important financial issue for senior citizens. The replies mentioned Social Security, healthcare, investments, and more. We’ve curated the responses into the top pieces of advice that you should know. Keep reading for awesome tips from our financial sages:

1. Consider a Medical Improvement Plan

“When seniors are reviewing their financial plans for 2016, one of the most critical items on their lists should be addressing rising healthcare costs. Unfortunately healthcare and medical expenses seem to continue to rise, and while Medicare can help alleviate a significant portion of those costs, it still places strict limitations on seniors’ budgets.

One way to help subsidize those costs is to look into a Medicare improvement plan. There are many types of Medicare improvement plans available now, and most do not require any additional out of pocket cost to the consumer! These plans can be extremely beneficial to seniors needing cardiovascular care, or those who have diabetes, or other critical illnesses that typically drive up the cost of healthcare for seniors, because they will cover many of the additional costs associated with addressing these types of medical conditions!”

Whitney Lee - oXYGen Financial

Whitney Lee

oXYGen Financial, Inc.


2. Maintain a Balanced Portfolio

“The single most important issue for retirees today is income planning. We are all living longer than previous generations, which means we will need our investments to sustain us longer and they will be required to produce an even greater stream of income. This is best addressed through two general approaches:

#1—maintain a life-long commitment to global stocks through broad-based index funds—stocks have an unvarnished long-term track record of producing positive real returns.

#2—maintain enough of your wealth in low-risk assets that are easily accessible and can be called upon during unexpected stock market declines, with the ideal vehicle being high quality, short-term bonds.

While everyone’s situation is different, a 60/40 mix of these two investments, stringently followed, should continue to help a lot of older investors live very financially-comfortable retirements.”

Eric Nelson - Servo Wealth

Eric Nelson, CFA®

Servo Wealth Management


3. Have a Will or Estate Plan

“Although Social Security’s file-and-suspend strategy for couples is going away in 2016, you can continue to postpone receiving your individual benefit. This is still a great way to grow your total benefits if you can afford to wait.

Aside from that, your top priority for 2016 is to make sure you have a will or estate plan in place (try willing.com for a free and fast version). Then keep it with your life insurance policy, and make sure your children know where to find them.”

Chris Walters - PolicyGenius

Chris Walters



4. Revisit Your Social Security

“Seniors need to revisit their Social Security if they have not yet begun claiming benefits. There was no cost of living increase this year, and some claiming strategies have been eliminated or changed based on the the latest budget. Get the most out of your Social Security by reviewing your options with a professional.”

Pam Horack - Pathfinder LLC

Pamela Horack, CFP®

Pathfinder Planning LLC


5. Don’t Over-Allocate to Stocks

“With CD and Bond rates so low, many retirees are putting more of their portfolio into the equity (stock) markets. It seems like a good strategy and the markets always recover, right? For people who rely on their portfolios to meet their living expenses, this brings additional concerns.

Over-reliance on equities is dangerous. A market decline of 20% means you would need a 33% return to get even. But taking money out at times like this is very costly and, in effect, is eating your seed corn. It’s better to keep 12-18 months of cash to ride through difficult times.”

Bob Klosterman - White Oaks Investment Management

Bob Klosterman, CFP®, CFWA

White Oaks Investment Management


6. Have Adequate Insurance

“The top financial planning issue for seniors is always PROTECTION; protection against an untimely death, chronic or catastrophic illness, short and long-term disability, and the continually rising cost of healthcare. The way to protect yourself and your loved ones is with adequate life, health and disability insurance.

People over 65 should own Medigap insurance. Most seniors don’t know what to look for when buying insurance, which is why they often overpay or buy the wrong policies. The best way to ensure you’re buying only the insurance you need at the lowest cost is to work with an experienced financial professional.”

Rich Winer - Winer Wealth Management

Rich Winer

Winer Wealth Management


7. Review Your Plan Annually

“Risk is the chance that your wealth will permanently decline, not that the stock market will see a temporary drop. Seniors’ investment portfolios are usually boxed in by a rule-of-thumb formula that may be far riskier than you realize.

For example, a portfolio that isn’t in harmony with your goals and needs may be on track to run dry before you die. If you haven’t had your plan reviewed in the last year or so, invest in a couple of hours with a fee-only financial planner. Getting an unbiased second opinion may be the best investment you ever make.”

Johanna Turner - Milestones FP

Johanna Turner, CPA, CFP®, RLP®

Milestones Financial Planning


See Part 2 of this post!



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