25 Ways We Help Clients Build Better Relationships with Their Money
9.) We make estate planning easier by helping clients build a financial plan.
To have an estate or legacy to give to your family and friends, you first need to ensure that all your personal needs are covered through end-of-life.
One of the most important financial things an adult can do is “know their number”- the amount of assets or passive income they will need to be financially independent, also known as “when they can retire.”
Retirement isn’t an age – it is usually a financial state of being where you are no longer dependent on working to afford and sustain your lifestyle and so you stop working. Whether you call it financial independence (just because you don’t have to work, doesn’t mean you have to stop working) or retirement, figuring out your number is critical to feeling confident about your financial status.
Arrivity financial planners help you figure out what your number is and when you can retire.
First, you need to know how much your chosen lifestyle costs, as this will directly influence how much money you will need to have in order to be considered financially independent. Two oversimplified examples with some basic math using the 4% rule are below:
- If your chosen lifestyle costs you $5,000 per month (pre-tax), you’ll need to generate approximately $60,000 per year to be financially independent. Back-of-the-napkin math and the 4% rule would dictate that you might need approximately $1.5 million in assets to make this happen.
- If your chosen lifestyle costs $15,000 per month (pre-tax), you’ll need to generate approximately $180,000 per year to be financially independent. Back-of-the-napkin math and the 4% rule would dictate that you might need approximately $4.5 million in assets to make this happen.
Of course these examples are just the tip of the iceberg and are over simplified – for example, not all investments and money is created equal: money in a taxable brokerage account vs. money in a tax-deferred IRA or 401(k) vs. money in a Roth IRA are all very different and will significantly change the math on how long the money will last.
Arrivity can help you with every aspect of this type of planning and use powerful software to create projections and models of how your financial assets will likely grow, decrease or be spent over time. Having a financial plan in place and knowing all of your key financial numbers will ensure you don’t work longer than you need to or “take the foot off the gas” too early.
Please contact us at: Contact Arrivity or 206.217.2583 or info@arrivity.com if we can assist you or someone you know with financial planning.
Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that the statements, opinions or forecasts provided herein will prove to be correct. Past performance may not be indicative of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. Securities investing involves risk, including the potential for loss of principal. There is no assurance that any investment plan or strategy will be successful.