How to Fix a Failing Retirement Plan

Ryan Wheless offers valuable advice on how to address a failing retirement plan. Ryan suggests assessing the current plan mathematically, setting clear retirement goals, increasing savings, diversifying investments, reviewing and adjusting investment strategies, managing fees, considering extended working years, and seeking professional advice.

By following these steps, individuals can better understand their financial situation, plan for essential expenses and enjoyable activities, make informed investment decisions, and ensure their retirement plan aligns with their goals. Ryan provides practical insights to help individuals overcome retirement challenges and secure a more financially stable future.

How to Fix a Failing Retirement Plan

Are you one of the many Americans who feel like their retirement plan is failing? The thought of a failing retirement plan can be scary, both before and after retirement. But there are ways to address this issue and get your retirement plan back on track. In this article, we will discuss some ideas on how to fix a failing retirement plan.

Assess Your Current Plan

The first step in fixing a failing retirement plan is to assess your current situation. Take stock of all your investments, including stocks, bonds, mutual funds, 401(k), IRA, and Roth IRA. Map out your portfolio and analyze each individual position. Then, consider your income needs, including Social Security and pensions. Test your plan to see if it is producing the income you need and calculate the long-term probability of success. By quantifying and testing your plan, you can determine if it is truly failing or if it’s just a perception based on emotions.

Set Clear Retirement Goals

Having clear goals for your retirement is crucial. Start by dividing your expenses into two categories: essential expenses and discretionary expenses. Essential expenses include food, water, shelter, clothing, healthcare, transportation, and access to medicine.

These are the expenses you need to have covered to maintain a basic quality of life. Additionally, you should determine how much money you want to allocate to discretionary expenses, such as vacations and other fun activities. Setting clear goals will help you create a retirement plan that meets your needs and desires.

Increase Your Savings

If you feel like you’re falling behind in retirement planning, consider increasing your savings. Pay yourself first and save more money. Even small increases in your savings rate can make a significant difference over time. Maximize your 401(k) contributions and take advantage of any employer matching programs. Be disciplined with your savings and avoid unnecessary expenses. By increasing your savings, you can accelerate your progress toward a comfortable retirement.

Diversify Your Investments

Diversification is an essential strategy for fixing a failing retirement plan. While stocks can be enticing, it’s crucial to have a well-diversified portfolio that includes stocks, bonds, commodities, real estate, international equities, and cash. Diversification helps reduce risk and provides a better chance of achieving long-term success. Avoid putting all your eggs in one basket by spreading your investments across different asset classes.

Review and Adjust Your Investment Strategy

Regularly review your investment strategy and make adjustments based on your changing circumstances. As you get older, your risk tolerance may change, and it’s important to align your investment strategy accordingly. Seek knowledge about various investment options and strategies. A good fiduciary financial planner can provide guidance in choosing the best investment approach that suits your needs and risk appetite.

Manage Investment Fees

Watch out for excessive investment fees, as they can eat into your retirement savings. Be aware of management fees, internal fees, and commissions associated with your investments. Work with a fiduciary advisor who is transparent about all fees charged to your account. Paying attention to fees can save you a significant amount of money over the long term.

Consider Extended Working Years

If you’re not on track with your retirement plan, consider extending your working years. Delaying Social Security benefits allows them to accumulate and provides a higher payout in the future. Working longer gives you more time to save and reduces the number of years you need to rely on your retirement savings. Part-time work or consulting can also provide additional income during retirement, giving you more financial flexibility.

Seek Professional Advice

Perhaps the most important step in fixing a failing retirement plan is to seek professional advice. Find a financial advisor or planner you trust and feel comfortable working with. A qualified professional can provide personalized guidance, help you make informed decisions, and offer alternative investment strategies. Having a coach or advisor by your side can keep you on track and ensure that your retirement plan aligns with your goals.

In conclusion, a failing retirement plan can be addressed and fixed. By assessing your current plan, setting clear goals, increasing savings, diversifying investments, reviewing and adjusting your strategy, managing fees, considering extended working years, and seeking professional advice, you can get your retirement plan back on track. Don’t panic—there are always ways to improve your retirement outlook and secure a fulfilling retirement.

Also read: Top 10 Retirement Risks And How To Avoid Them


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