As a retiree, it is now time to harvest the fruits of your labor. Generating sustainable income through investments is now paramount. To do so, you will likely have 401(k), Traditional IRA, mutual fund, and individual stock brokerage accounts at your disposal. Beyond the nuts and bolts of budgeting, you may also look forward to leaving a legacy through charitable giving and estate planning. As a retiree, Onyx Investments can help you navigate the financial planning process through goal setting, data gathering, and investment allocation. Our goal is to maximize the enjoyment and productivity of your Golden Years. You have earned the right to take time off to teach the next generation.

Goal Setting

Onyx Investments recognizes that effective retirement planning advice begins with the evaluation of life goals. At this point, we will brainstorm a timeline of important benchmarks through your retirement. From here, we can estimate projections for the draw down of retirement savings and income. In terms of a standard of living, we will work together to define specific goals according to your value system. As an empty nester, you and your wife may opt to downsize and sell off a suburban single-family home in Naperville, in exchange for a tony high-rise condominium in Chicago’s River North neighborhood.

Cash Management and Insurance

All major lifestyle changes, of course, require thoughtful cash management strategies. Throughout retirement, your goal should be to minimize committed expenses, in order to live comfortably, while also being able to set aside cash for leisure. Committed expenses may be associated with housing, while discretionary spending goes towards extracurricular goods and services, such as resort travel, golfing, and fine dining. The Onyx Investments data gathering process will walk you through a financial inventory of assets, liabilities, insurance policies, income, and expenses. This stage calculates the all-important free cash flow figure, or money left over after meeting monthly expenses.

Effective cash management remains heavily linked to the strength of your insurance portfolio. In retirement, adequate health and life insurance coverage will preserve the integrity of your family’s nest egg through multiple scenarios. Life insurance, of course, is a critical cog within your estate plan. Estate planning is a family affair, and Onyx Investments is sensitive to your unique concerns related to the passing of the torch of assets between generations. High net worth clients must strike a delicate balance between providing for heirs, while also maintaining a disciplined work ethic throughout their lineage.

Retirement Plans

The 401(k) to Traditional IRA plan rollover is most likely the trigger event that marks your transition out of the workforce and into retirement. Rolling over your 401(k) into a Traditional IRA account allows for total control over your retirement funds, while also avoiding penalties and deferring income taxes for a later date. Traditional IRAs feature similar rules to those of your old 401(k) plan, where withdrawals are taxed at ordinary income rates through retirement. Early IRA withdrawals made before age 59 ½ are subject to additional taxes. Onyx Investments will help you to calculate IRA required minimum distributions, which must be withdrawn before you reach age 70 ½, in order to avoid severe tax penalties.

Asset Allocation

Throughout retirement, harvesting income, while also managing inflation risks remains all-important. Bureau of Labor Statistics Consumer Price Index data pegs the average inflation rate at 3%, annually. In order to preserve purchasing power, Onyx Investments will recommend a conservative mix of stocks, bonds, and money market securities to serve retirees.