Managing Cash Flow During Retirement
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This week we discuss:

• Why you should ask your advisor about their succession plan
• How to manage cash flow during retirement

Less Than 10% of Advisors Have a Succession Plan

This is a scary number considering that if your advisor is unable to serve you due to injury or death, the retirement plan you’ve put in place could be in jeopardy. 

• Who will service you?
• Who will advise you?
• What communication will you receive?
• Who will manage your assets?

 These are just some of the important questions that need to be asked by you to assure your retirement plan is not disrupted.

I discuss:

• the importance of asking your advisor about their written succession plan
• what items to look for
• the communication plan that should be in place
• how to protect your retirement plan in the event your advisor is suddenly unavailable.

This month, I’ll post a checklist in the Retirement Library of items you should look for in your advisors succession plan to assure some continuity of service.

Listener Question:  Lynn asks, “How do I manage my cash flow during retirement?

How to manage cash flow during retirement is one of the questions I’m asked most. Not receiving a monthly paycheck during retirement can be unnerving. In retirement, it is important to have a system to create a paycheck to pay your monthly retirement expenses. 

I outline the Cash Flow Reserve system we use to help clients cover their retirement expenses. 

The Benefits of the System

• It can help you feel safer about meeting your needs
• It provides a margin of safety during turbulent markets
• It positions you to make smarter financial decisions
• It gives you more flexibility to adjust as conditions change
• It helps you sleep at night

 How It Works

• Checking Account—To pay your lifestyle expenses
• Cash Reserve Account—maintain 2 year’s expected living expenses, distributing a monthly “paycheck” to your checking account
• Extraordinary fund—Maintain cash reserves for extra expenses you will incur over the next 12 months
• Long-term Investment—Long-term investment assets that include bonds maturing in 3-5 years
• Review and adjust every 6 months

This week I’ll post a detailed outline on how to build your Cash Flow Reserve system  in the Retirement Answer Library.

Resources Discussed

Retirement Answer Library)

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