Mark Zaifman's thoughts on Money, Global Economic Trends and Politics

How To Avoid Common Mistakes When Preparing For Retirement

Posted by Mark Zaifman on Tue, Oct 18, 2016 @ 08:59 AM


According to Pew Research, every day for the next 14 years, 10,000 baby boomers will reach age 65. Think about that for a second, that’s a lot of people. And whether they plan to retire at age 65 or in a few years, preparing for retirement is now front and center in their lives.

Over the years, guiding hundreds of clients through the retirement planning process, I’ve seen my share of the good, the bad and the ugly in terms of being prepared for this major life transition we call retirement.

So whether you’re prepared for retirement or just getting started, keep an eye out for some of these common pitfalls:

Failing to Have a Retirement Income Strategy

It’s a saying we’ve all heard a gazillion times. Fail to plan, plan to fail. Once you’ve stopped working and are no longer saving for retirement, your cash flow goes in reverse, so to speak. Instead of saving, you’re now withdrawing. Of course, on the surface that seems easy.

Yet easy has nothing to do with it. How often to take withdrawals? Which accounts to withdraw from? Which investments to sell? How to make your withdrawals tax efficient? Lump sum or annuity from your pension? These are just a few of the questions that need to be carefully analyzed before launching into retirement.

Developing a holistic retirement income strategy (before you retire of course) that is tax savvy and aligns with your overall financial goals is the road to peace of mind in retirement.

Thinking That Not Much Will Change Once You Retire

It’s difficult to understate the impact retirement has on our lives. After working most of our adult lives, you turn around one day, you wake up and it’s the first Monday morning of the rest of your life. As you habitually begin preparing your to-do list on that first Monday morning, it dawns on you that you’re now retired and no longer need to go anywhere and you sure don’t need a to-do list for work. You’re free.

With your newborn freedom come what many refer to as 'gold-plated' problems. Mainly, how do you not just fill up a day’s worth of time, but a month or year of time? How do you structure your time? How to you keep social? How do you stay connected to your friends if you move away?

The solution for avoiding this pitfall is trial runs. If you’ve banked a lot of vacation time, try taking a month or more time off, stay home if that’s where you plan to live when you’re retired or stay for a month in your soon to be new area and imagine you’re retired. This is a powerful way to grab a sneak preview of your future, starring you.

During this sneak preview month, play around with different options. For example, one week fully plan out each day, from when you wake to when you go to sleep. The next week, totally wing it. No plans from morning to night. Another week spend a few a few days taking road trips. And perhaps another week volunteer at a non-profit and see how that feels. You get the idea. Practice makes the master. The more you prepare, the higher the odds of a successful retirement.

Not Understanding the Value of Social Capital

Not every boomer is going to reach retirement age with enough saved to maintain their current standard of living. For many people, that’s unacceptable. As a result, many move to a less expensive area in the country in order to maintain the lifestyle they desire. And if you’re fortunate enough to live in the Bay Area, finding a less expensive place to live is not that hard.

But here’s what missing in that equation. Yes, you can move to a less expensive area of the country, and perhaps even have a higher standard of living than before, but in retirement, that becomes less important than imagined. What does become vitally important is your social capital.

Your social capital may not appear on your net-worth statement, but valuable it is. More and more research and studies on people that live highly functional and inspiring retirement lives illustrates how crucial friends, neighbors and your community are to your overall well-being.

Forgetting to Lead a Life That Inspires You

One of the scariest aspects of retirement is the unknown. What will life be like when you no longer have work as a source of identity, when you’re no longer feeling as valuable and important as you did when work provided so much of who you were, so much of your self-identity? Now what? What happens when you’re just a ‘regular’ person again, not whoever you were in your career, business or practice?

Thoreau wrote:

"The mass of men lead lives of quiet desperation and go to the grave with the song still in them."

And to this I add:

"If not now, when?"

Maybe it’s been so long since you allowed yourself to dream that you forgot how to do it. Please give yourself permission to dream, and dream big. Imagine the possibilities.

A life you lead that inspires you, however that takes shape, is surely to be a life that inspires others. That’s the ultimate in paying it forward.

Now it’s your turn. It’s your turn to lead a life that inspires you greatly. You have the time, yes?


Photo credit J.Cridland


Tags: retirement planning

How Boomers Are Redefining Retirement Success

Posted by Mark Zaifman on Fri, Sep 09, 2016 @ 10:34 AM



The way boomers define ‘retirement success’ is changing rapidly. The old model of ‘success’ - where your goal is to accumulate as much money as you possibly can by the time you reach the finish line, regardless of the stress and impact on your physical, emotional and spiritual health, well, that model is no longer sustainable.

One reason we give for allowing stress to build in our lives is that we don’t have time or don’t make the time to take care of ourselves. We’re too busy chasing a phantom of the successful life and not knowing or not wanting to know when enough is enough in terms of how much needs to be saved for a secure financial future.

As a comprehensive financial planner working mostly with boomers, I have the good fortune to observe what’s on a lot of clients minds in terms of their future dreams and desires once retired and financially independent. What most are seeking is the ‘good life’.

Yet what is this oasis we call the ‘good life’ we all dream about and visualize once we retire? Somewhere along the way we abandoned that question and shifted our attention to how much money we can make, how big a house we can buy, how expensive of a car we can drive and how high we can climb up the career ladder.

Basically, our attention and focus in terms of preparing for retirement has been all about financial capital. That has been our metric in terms of measuring retirement success. That metric is no longer enough. Boomers, and especially my boomer clients, are disrupting the very notion of what retirement success used to look like and saying we want a different model. And that’s music to my ears.

Course Correction

Sometimes it takes a serious health setback - the loss of a parent, a partner/spouse, other times it’s a loss of a job, business, career, and sometimes it’s a major financial setback that has you go back to the drawing board and ask yourself - what’s the purpose/dharma of my life?

It’s usually at these pivotal turning points in life when a boomer that might have been hesitant to reach out to a financial planner in the past, for a variety of reasons, finds the courage to pick up the phone and decide somehow, someway, a course correction is needed in my life. Can you help me with that?

The reason many financial planners, including myself, approach financial life planning on a holistic level is so we can go deeper into a discussion of your money and your life. How is stress impacting your quality of life? Do you go to work feeling inspired or dreading another day at the office? Are you making a living or a dying? How much is enough? Obviously these are not stock and bond questions, yet questions like these are at the core of why the definition of ‘retirement success’ is changing rapidly.

One of the best kept secrets in the world of comprehensive financial planning is how powerful the capabilities of financial planning software has become. What used to pass for a financial plan, which was nothing more than a one-size fits all report full of graphs and irrelevant data, has been replaced with a new generation of scenario modeling software.

With this cutting edge planning software, modeling what-if scenarios is now becoming the default standard in the financial planning profession. Although there are still plenty of Wall Street firms fooling clients with these cookie cutter 'financial plans', their days fortunately are numbered as consumers demand a higher level of customization and comprehensive financial plans.

IMG_6314.jpgHealth is Wealth

What’s the number one question I’m asked when a client that fits the profile above comes into my office? How soon can I retire?

Usually there’s been a major life event as I mentioned above that prompts that question. Sometimes it’s turning 50 or 60 that knocks you off of life’s auto-pilot as well. And other times it could have been a long awaited vacation, where you actually had enough time to decompress and think clearly again and realize the life path you’re on no longer aligns with your core values.

Whatever the reason is that creates the burning desire to shake up the status quo of your life and consciously and intentionally make a shift, I say bravo! If not now, when? And as Mark Twain said so well:

Twenty years from now you will be more disappointed by the things you didn’t do than by the ones you did do. So throw off the bowlines. Sail away from the safe harbor. Catch the trade winds in your sails. Explore. Dream. Discover.

Tags: retirement planning, comprehensive financial planning, relationship with money

Broken Dreams- A Retirement Plan Turned Upside Down

Posted by Mark Zaifman on Tue, Aug 02, 2016 @ 10:18 AM

heart.jpgThis is a true story of a couple that planned on launching into retirement with high hopes, only to find their dreams dashed. It’s a story of betrayal, self-sabotage, unconditional love and the amazing gift of forgiveness and redemption.

Last summer, I met, let’s call them, Laurie & Ben, in my Petaluma office. Laurie had just turned 67, Ben was 70. They were in need of a retirement plan as Laurie was looking to retire at the end of last year. Ben had retired 3 years earlier.

Laurie was the one that contacted me initially. After our phone meeting, my sense was that based on their needs, we were a good match to work together, so we set a time for the three of us to meet in person the following week.

The night before we were scheduled to meet, I received an email from Ben saying something came up and could we reschedule for the following week. After they made an appointment then cancelled again, and then once more, I suspected it was the usual case of one spouse attempting to drag the other spouse to meet the ‘money guy’, with one not really wanting this meeting to happen. Oh well, win some, lose some.

A couple weeks went by and in came a call from Laurie. We had both hit it off on our initial phone meeting, she was a referral from a client I really liked and her energy and positive attitude was contagious. She asked if we could attempt one more try at meeting and this time she said Ben would be there no matter what. So I figured, what’s to lose? Why not one more attempt. The 4th will be the charm.

The following week, to my surprise, the night before our meeting, there was no email from Ben asking to reschedule. So that morning I finally met Laurie and Ben. Laurie was excited, Ben looked nervous and even though my office was on the cool side from the a/c, he was shvitzing. That should have been my first red flag that something was up, but I chalked it up to the nerves of meeting a financial advisor.

All Hell Breaks Loose

After a few minutes of getting to know each other better, we moved into a discussion of their plans/dreams/desires for retirement and how they visualized their lives in their 70’s, 80’s and beyond.

Laurie provided a rough estimate of their net-worth ($2 million plus) and said although she used to handle all their personal finances, including their investments and regular monthly bills, since Ben retired, he had taken over that role. In turn, my focus shifted to Ben, who, still shivtzing, looked at his wife, then me, and didn’t say a word.

That silence lasted for about 30 seconds. Then, Ben blurts out he screwed up and kept saying that, crying and repeating, Laurie, I screwed up, I screwed up.

Now having been in some precarious situations previously, when one spouse or the other during a financial planning meeting confesses to something they did wrong, I’m sort of used to this stuff. Yet the way Ben was falling apart in front of my eyes told me this was going to be a big screw up. Little did I know then how big of a screw up it would actually turn out to be.

Once Ben was able to compose himself, the truth came flooding out. Not only did they not have a $2 million dollar net worth as Laurie had assumed, they were actually $100,000 in debt. What happened?

Ben picked up a nasty habit once he retired. He became a gambler. Casinos, race tracks, day trading, all types of sports and internet gambling - you name it, he bet on it. Over the past 3 years, unbeknownst to Laurie, he remortgaged their home, forging Laurie’s signature (they had paid off their mortgage 3 years ago) pulled $800k of equity out in the process, then added a second and even a third mortgage as time went on.

In addition, he withdrew all the money from his 401k and IRA’s and then when he got desperate, forged Laurie’s signature again and emptied out her IRA money and her inheritance as well. The bottom line -from close to a $2 million dollar net-worth, this couple was now $100k in debt.

A Year of Pain and Ultimate Forgiveness

To my surprise, two weeks ago Laurie called me. When I saw her name show up on caller ID, the memories of that eventful meeting came flooding back. Truth be told, I’ll probably never forget that meeting for the rest of my life.

After a year of couples counseling, and individual counseling for Ben, after the hurt and pain of the lies and betrayal Ben inflicted on Laurie, forgiveness and healing eventually took over. Trusting Ben again, as Laurie told me during our conversation would take more time, but she was ready to put their life together, again, and move forward.

Instead of retiring, Laurie now will need to work another 5 years or so. Ben, a former CPA, went back into practice and attends a gamblers anonymous meeting every couple weeks. They sold their home and moved into a small condo they rent. Laurie has resumed handling their finances. Next year, as they further rebuild their net-worth, we plan to meet and develop their financial road map.

Pay Attention

Think about that phrase-pay attention. Just like paying for anything, paying attention requires a cost. It’s a cost many people ignore at their own peril. To pay attention is an intentional act that takes practice. It requires being present. It means you do not ignore red flags. You ask questions when something seems off. In our busy lives, paying attention or not paying attention, whether it’s your finances or your health, has consequences.

Laurie admitted to me during our recent call that she sensed something was amiss. But like anyone that’s been with their life partner for 30+ years, it’s easy not to pay attention to those things as trust is your normal default.

What inspired me most, is how Laurie found it in her heart to forgive Ben for his betrayal and the dreams he shattered for the life she imagined they would have in retirement. After all is said and done, she said having ‘her Ben’ in her life is all that matters. Wow!

So what’s the moral of this story? As you near retirement or if you’re in retirement and you notice your partner acting odd or see a change of behavior, pay attention. Stop, listen and discover and trust your intuition if it’s telling you something is not right.

Finally, even if it’s a once a year check-in with your spouse, during retirement especially, review your overall financial picture. Seek a second opinion from a financial advisor if that makes you feel better. Overall, just be willing to be present and pay attention. Your retirement and your dreams depend on it.

Photo credit Mrs. Phoenix

Tags: retirement planning

Vanguard Founder and Index Fund Pioneer John Bogle Celebrates 65 Years in the Financial Services Industry

Posted by Mark Zaifman on Tue, Jun 28, 2016 @ 05:35 PM


There’s not many people in the financial world that have earned as much acclaim and adoration as the founder of Vanguard, John Bogle. Like his good friend Warren Buffett, these two men exemplify radical humility in an industry loaded with oversized egos.

Bogle leveled the playing field for investors when he had the vision and courage to take on the financial services industry by introducing low cost, no-load, index funds. This revolutionary concept changed forever the investing landscape and its continued impact will be felt for generations to come.

Unlike most firms in the financial industry, Vanguard stands apart as a mutually owned company, owned by its investors. There is no middleman skimming profits off the top. Similar to a credit union, profits are plowed back into lowering the cost of their services to their members, or in Vanguard’s case, to their investors. This difference alone is a stark contrast to how most of the firms on Wall Street operate. Therefore, it’s no secret how Vanguard has become the largest mutual fund company in the U.S.

Bogle has been my hero, my north star, since I first started investing back in the day. His integrity, his outstanding vision, his moral compass and his continuing contribution to this industry is remarkable.

Bravo! Well done.

Vanguard celebrates John Bogle's 65 years in the financial services industry.


Photo credit by Sam

Tags: mutual funds, index funds, John Bogle, Vanguard

On The Road to Retirement Planning

Posted by Mark Zaifman on Wed, May 04, 2016 @ 09:30 AM

On The Road to Retirement... “If you don’t know where you’re going, any road will take you there.”

path.jpgThe refrain "If you don't know where you're going, any road will take you there" was essentially a paraphrase of an exchange between Alice and the Cheshire Cat in Chapter 6 of Lewis Carroll's Alice in Wonderland: "Would you tell me, please, which way I ought to go from here?"

For many new clients I meet, especially clients that are in their mid-50’s and early 60’s and on the road to retirement, which way I ought to go from here is the question they most want answered and the question I most love responding to.

Pre-retirement, that precious time in our lives when we attempt to earn and save enough money to last us the rest of our retired lives is a daunting task for many an investor. Although as daunting a task it may or may not be, sticking your head in the sand is not the answer. Nor is thinking you’ll just keep working through your 70’s. Although that may be your noble intention, it may not be up to you.

For many, one of the most difficult parts of saving for retirement is simply understanding how much they need to save by the time they reach this milestone in life. In other words, many an investor is flying blind on the road to retirement, raising the probability of a crash landing.

The Danger of Lacking a Plan

Without a plan, people will often build their investment portfolios bottom-up, focusing on investments piecemeal rather than on how their portfolio as a whole is serving their objective.

Another way to describe this type of investor behavior is ‘fund collecting’. You’re drawn to evaluate a particular fund and if it seems attractive, you buy it, often without thinking about how or where it may fit within your overall investment strategy.

Without a clear and well-designed holistic investment strategy, you’ll be tempted to buy funds with high performance ratings only to see those same funds underperform immediately after receiving high marks.

While paying close attention to each investment may seem like the smart thing to do, this process often leads to you eventually owning a hodgepodge of mutual funds, stocks and bonds that do not serve your ultimate needs. As a result, your portfolio may wind up concentrated in a certain market sector, or it may have so many holdings that managing and tracking all these investments becomes a nightmare.

Most often, what causes your investment portfolio to get so off track are common, avoidable mistakes such as performance chasing, market-timing, or reacting to market “noise”.

On The Road to Retirement Success

If you know how much you need to accumulate in total savings by the time you intend to retire and you have an investment strategy that aligns with your core values and goals, then you’re either a Spiritus client or you’re a DIY and you’ve done your homework.

Here's what I’ve discovered by having the opportunity to help my clients prepare for retirement and then actually retire and live their dream. Nearly all of them said that it was only when retirement was about 5 years away that it started to feel real. So if you’re 5 years away from retirement, has it begun to feel real for you?

If and when it does begin to feel real, that’s when it’s time to assess where you are right now, financially speaking, and determine which road to take on your journey to retirement. And although any road may get you there, ‘there’ may not be even close to what you had in mind.

I used the Alice in Wonderland refrain because I meet far too many people that are taking any road they can find to retirement and falling for any sales pitch that promises extra high returns or offers a short-cut to the finish line. Caveat emptor.

Some are taking far too much risk with their investments when they’re only 5 years away from retirement. Some have no idea how much they need to save in order to maintain their desired standard of living. Some do not know nor do they have a retirement income plan that maps out their income streams in retirement and the extent to which they’ll need to tap their investment portfolio.

All that said, what causes me the most distress is how many people in their late 50’s and 60’s are worried sick about being able to retire. They stress and worry and they do not live life with joy. Instead they live in a state of fear and high anxiety.

As a recovering money worrier, one of my greatest joys in life is not the first, but usually the second financial planning meeting I have with clients as we co-create their retirement plan.

It’s at this second meeting, after having conducted a full analysis of their current financial picture that we get to discuss options and possibilities.

Options and possibilities, two words worth repeating as these are some of the most comforting words a client can hear from a financial planner when worrying about money has been a full-time occupation.

As in most everything, there’s no guarantee, yet I’ve seen many a chronic money worrier be liberated from fear around their money and eventually become fearless once they took the bold and courageous step forward and put their financial house in order. It’s a beautiful thing to watch and be a part of.

Photo by Pat Chiappa

Tags: investing, retirement planning

Long-Term Investing - Why 5 Days Over 10 Years Have Made All the Difference

Posted by Mark Zaifman on Tue, Feb 16, 2016 @ 10:26 AM


These past couple months, and especially the past few weeks, have been particularly nerve racking for investors. With memories of the last stock market crash still etched into our collective psyches, it’s challenging, even for disciplined long-term investors, not to get caught up in the frenzy.

Over the weekend, an article in the business section of my local paper caught my attention. The article that was published on February 11th, by Stan Choe of the Associated Press had the following statistic that made my long-term investor heart sing:

"Much of stocks’ long-term returns can come from just a handful of really big days, and it’s impossible to predict when they’ll occur. Miss them, and owning stocks gets much less lucrative. Two-thirds of the S&P 500's gain over the last decade has come from just five days".

“This is the whole point of why equities generate the best returns of any major asset class over long periods of time. They have higher volatility. If you can live with the higher volatility, you should be in a position to earn higher returns. I fully expect stocks ultimately will reach new highs".

This is worth repeating - 5 days over the past 10 years, just 5 random days, were responsible for 66% of the S&P 500’s gains. Wow, that’s amazing to me.

So what’s the moral of this story? It’s just illustrates once again how hard and nearly impossible it is attempting to time the market. By market timing I mean deciding to sell all your equity positions when the market is in a downturn and then having the insight of knowing when to get back in. As John Bogle often reminds us long-term investors; trying to time the market is mission impossible.

Seeing the market have a few good up days recently almost feels like a mirage after so many weeks of nothing but negative news. So let’s hope for the best but be prepared for another test of new lows. Until we see the market have a few back-to-back weeks of steady and sustainable upward movement, we’ll still be on this roller coaster ride, so please, stay buckled up.

All that said, anytime you feel the urge to sell and alter your long-term asset allocation because the markets are heading downwards, just remember to think about how over the course of 10 years, just 5 days made all the difference in the world to your investing success.


Photo credit by Joy

Tags: stock market

A Market Decline is Temporary-Selling at a Loss is Permanent

Posted by Mark Zaifman on Mon, Jan 18, 2016 @ 11:31 AM

rollercoaster-2.jpgHere we go again…..up, down, up, down. If this stock market roller coaster ride has you feeling anxious, you’re not alone.

Although the market crash of 2008-2009 is now thankfully in our rear view mirror, for all of us long-term investors that hung in there through the worst of it, starting the New Year off with such high volatility in global stock markets can easily spook even the most seasoned investor.

With all this recent volatility, expect to see lots of financial talking heads making predictions. Some will be dire, some will be optimistic. But at the end of the day, these are guesstimates, at best. Take everything, especially now when emotions are running high, with a grain of salt.

Many markets and asset classes are now in a “correction”. A stock market correction is when prices fall 10% from the all-time high. But - and this is important, corrections are generally temporary price declines interrupting an uptrend in the market.  It’s very normal for markets to have one, two and sometimes three corrections in one year, with markets still ending in positive territory at the end of the year.

Once markets began recovering from the 08-09 crash, what we experienced - very low volatility and strong annual performance, year after year after year, was highly unusual.

Although as enjoyable and profitable as it was, it was also dangerous because complacency can easily settle in when markets seem risk-free.

Why do I claim complacency is dangerous? Because it has a habit of causing investors to make rash and emotionally charged decisions once markets become volatile after unusually long periods of relative calm.

With markets rewarding investors so generously while at the same time seeing such low volatility, it’s easy in retrospect to now see how complacency settled into many an investor’s behavior. The remedy for this situation is the big D-discipline.

Do You Have The Discipline Needed To Stick With Your Investment Strategy?

Investing provokes strong emotions. In the face of high market volatility like we’re experiencing now, some investors may find themselves making impulsive decisions or, conversely, becoming paralyzed, unable to implement an investment strategy or to rebalance a portfolio as needed.

Discipline and perspective are the qualities that can help you remain committed to your long-term investment strategy. And yes, I know, that is much easier said than done, especially when it comes to something as crucial as your financial security.

In volatile markets, with very visible winners and losers, market-timing (getting out of the market now and at some point getting back in) is a dangerous temptation that you will face head on. The appeal of market-timing is exceptionally strong when you’re feeling over-confident or just the opposite, feeling scared.

What's key to remember if and when you’re feeling tempted to sell in this most recent downturn is this sound guidance from John Bogle, founder of Vanguard:

“Thinking you should get out of your stock allocation (1) then (2) get back in, when? You might be lucky once when you get out, but being lucky twice, knowing when to get back in? Nearly impossible odds to get that right twice."

Abandoning a planned investment strategy can be costly, and research has shown that some of the most significant obstacles you’ll deal with as you do your best to stay on track with your plan are behavioral: the temptation to chase performance, the allure of market-timing and the failure to rebalance.

Practice makes the master. Now’s your time to practice and flex your discipline muscle.


All indications are that 2016 will potentially be a very volatile year in global stock markets, so please prepare yourself for that, buckle up, and do your best to find your sanctuary from the noise. Although we can’t control the markets, we can control our response to what’s happening.

By being in control of your emotions, instead of the other way around, you’ll not only increase your resilience to these ups and downs, you’ll increase your self-confidence which in turn will help you stay on track with your investment plan when the going gets rough.

As I mentioned in the title of this blog, a market decline is temporary while selling at a loss is permanent. If the Vanguard S&P 500 fund that cost $190/share earlier in the year is now ‘on-sale’ for $172, from my perspective, that’s not a crisis to sell, that’s an opportunity to buy.

And as the “Oracle from Omaha”, Warren Buffet likes to remind us:

“Be Fearful When Others Are Greedy and Greedy When Others Are Fearful”


Photo credit by Felicito Rustique

Tags: investing, stock market

Do I Need to Adjust My Retirement Income Strategy in 2016?

Posted by Mark Zaifman on Wed, Dec 30, 2015 @ 08:52 AM



It’s been a so-so year for investors in 2015. Lots of volatility throughout the year with little upside performance to show for it. I believe the title of this recent article says it best: The Year Nothing Worked: Stocks, Bonds, Cash Go Nowhere

With the recent enhancements high frequency traders have made, volatility looks to be the ‘new normal’.

In 2014, the Ibbotson/Morningstar asset allocation models we use when constructing portfolios projected an estimated return of 7.2% for a 60% allocation to equities and a 40% allocation to fixed income. At our firm, this would be considered a moderate risk portfolio.

Now, heading into 2016, Ibbotson is projecting a 5.27% return for that same 60/40 asset allocation. For investors with 10+ years before retirement, while not good news, it’s not the end of the world as you’ll have time to course correct if needed.

For those of you, including all my clients that are already in retirement and withdrawing from your portfolio or those getting close to the finish line; will your retirement income strategy need adjusting? The answer is yes. We’ll meet and update your plans first quarter of next year.

Retirement Income Planning

Think about how much time you spend throughout your working years managing your personal finances; managing cash flow, saving, investing, insuring, getting your kids through college, basically doing all the responsible things you know you need to do in order to save enough money so you can retire in style and never worry about running out of money in your old age. Call this the accumulation phase of your life.

Now, think about how much time you’re putting into the next phase of your financial life, the distribution phase. This phase begins once you start withdrawing from your portfolio. Compared to all the time you invested during the accumulation phase, monitoring, measuring results, course correcting when needed, how does that stack up with the time you’re investing in the current or perhaps soon to be next phase of your life?

I meet way too many people that are flying blind as they head into retirement. With no plan, no retirement income or tax strategy, the odds of crash landing into retirement are high. Sometimes it takes a conversation with a friend, colleague or family member, sometimes it’s a reoccurring nightmare of being old and homeless and other times it’s just a voice in your head saying it’s time to figure this s**t out that finally moves you into action.

Taking control of your financial future begins with assessing where you are today and seeing how that aligns with the lifestyle you desire in retirement. That’s your starting point. Does it take courage to take this first step? It sure does, big time. But once you take this major first step, the sense of relief you’ll feel, even if the news is not so good, makes it so very worth it.

For those that do not want to go it alone, this would be a good time to engage with an independent, fee-only financial advisor that works in a fiduciary capacity.  Of course, that’s a self-serving request, yet I can’t stress enough the potential value you’ll receive by having a professional objectively analyze your current financial picture.

To illustrate further what types of analysis you can expect to see when doing retirement planning, check out these sample reports produced using our financial planning software. My absolute favorite report is the net-worth outlook report on page 4. I like to think about this as a score card, so to speak. Being able to track your annual actual to projected net-worth goal helps hold you accountable to your plan and also signals when it’s time to course correct. The report starting on page 8 is also a favorite as it illustrates your withdrawal rate in retirement.

Keep in mind, these are sample reports with fictitious clients. The sample reports come in only one speed for illustration purposes - high net-worth, so please remember, all planning work is customized to your specific needs and net worth.

Finally, I’ll leave you with what’s been referred to in the financial planning profession as the:

‘Retirement Income Holy Grail’

  • Maintain my lifestyle and maximize my income from portfolio withdrawals, especially early in retirement.
  • Eliminate the chance that I could run out of money
  • Offset inflation and maintain my purchasing power
  • Avoid undesired changes to my spendable income
  • Preserve my nest egg for the people and causes I care about
  • *Practice Gratitude

*my addition

Always remember, retirement planning done well will inspire you greatly. After all, this is your life plan you’re designing, what’s not inspiring about that?


Photo credit


Tags: retirement planning

Finding Your Financial Balance in 2016

Posted by Mark Zaifman on Wed, Nov 25, 2015 @ 12:50 PM


The stock market is volatile. Your bills are skyrocketing. Getting a grip on your finances, however, goes beyond your checkbook. Take a good hard look at your relationship with money, and you’ll finally figure out how the two of you can start getting along.

Money is many things to many people. For some, it beckons and entices; others find it scary and confusing. Whatever the relationship, that rapport directly affects our ability to attract, spend and hang on to what we have.

Whether there’s $10,000 in our account or $10 million, we follow the same behavioral patterns. Changing our approach to money comes when we’re able to take a good honest look at the inner workings of our relationship with money.

So how have you been treating your money lately - and how has it been treating you? Maybe you feel inferior to it or you don’t take it seriously. Maybe it bullies you around or seems to skip town when you need it most.

Money as the Judge

For some, money speaks in harsh, critical tones. It’s disappointed in the way you’ve handled it and it tells you so. Maybe you feel that your money has no faith in you. When you see it that way, you won’t feel positive, and that will have a negative impact on how you deal with it.

Perhaps you feel bad that you didn’t read the full 27-page prospectus on your mutual fund or that you haven’t saved enough for retirement. The effect? You feel inadequate and incapable which is not a good foundation for a healthy money relationship.

To begin to turn things around, find out where that voice is coming from. Your parents? Financially savvy friends who think they know more than you? Get to the source of it and question it. But even more important, take note of what sound decisions you have made, (and there must be some) put the criticism in perspective, and work on honing your gifts rather than calling out your weakness.

Make Friends with Your Finances

Building a healthier relationship with your money starts with how you treat it. Every relationship has its own specific needs. Your mission is to discover what your money needs from you before you can get what you need from it.

Consider the attitudes about money you learned at an early age. Was it the root of evil? The Holy Grail? Did you learn to seek it at all costs, or never give it a second thought? What did your first dealings with money; allowance, babysitting cash, $10 tucked inside a birthday card, teach you?

Now, think of one of your closest relationships and quickly jot down five statements that describe the way you treat that person - for example, “I worry about her”, “I make him laugh” or “I’m there when she needs me”. Now write down five statements that describe the way you treat your money. Do you worry about it? Guard it possessively? Enjoy it? This exercise can give you some insight into how to make money your ally instead of your enemy.

Start Fresh in 2016

Love it or hate it, money and how we deal with it impacts our lives in so many ways. With the New Year approaching, there is no better time to invest in this crucial relationship than right now.

Finding your money balance takes time, patience and practice. Yet this investment of time and energy can reap dividends for a lifetime.

We learn early on to focus most of our attention regarding money on the external. How much we earn, where we live, the type of car we drive, where we shop, the clothes we wear, etc. All this focus on the external, (the ego), works to undermine our relationship with money and creates a toxic link of equating our self-worth with our net-worth. And when/if our net-worth drops, so goes our self-worth.

Why not make a commitment to yourself that 2016 will be the year you put the time and attention to your money relationship that it needs? Why not have 2016 be the year you liberate yourself from fear, worry and stress around money? Why not have 2016 be the year you set yourself free?

Bottom line - If a healthy and abundant relationship with money is your desire, then you’ll need to summon the courage to choose a different consciousness. This will not be easy and you will have many setbacks along the way. Yet once you’ve transformed your relationship with money and put yourself on the road to financial independence, the feelings of personal accomplishment and self-empowerment will blow you away.

Photo credit James Jordan

Tags: relationship with money

Is Your Retirement 10-Years Away or Sooner?

Posted by Mark Zaifman on Fri, Oct 23, 2015 @ 01:51 PM


If your retirement is 10-years away or sooner, you'll want to read, Get What’s Yours - The Secret To Maxing Out Your Social Security by Laurence Kotlikoff, Philip Moeller and Paul Solomon

One of the most overlooked elements of preparing for a successful retirement is deciding when to start drawing your Social Security. If you’re a married couple, the decision becomes even more complex.

Up until recently, the majority of people, usually by default, either started collecting Social Security at their full retirement age, early, at age 62, or waiting if possible until age 70. Simple on the surface right, three relatively easy choices.

Guess what. There are dozens of Social Security strategies that most people are unaware of. And remember, in the game of money, strategy is king.

Below are a few excerpts from the book Get What’s Yours - The Secret To Maxing Out Your Social Security that I hope entice you enough to read it.

“We’ve written this book to help people maximize the Social Security benefits they have earned and therefore, we believe, deserve to get. We three authors-Boston University economist Laurence Kotlikoff, journalist and aging expert Phil Moeller, and PBS News NewsHour economics correspondent Paul Solman-have spent years studying the system and making it intelligible to the public.”

“Why have we bothered to write this book? Because Social Security is, far and away, Americans’ most important retirement asset. And that’s not only true for people of modest means. Middle-income and upper-income households actually have the most to gain, in total amounts, from getting Social Security right. Toting up lifetime benefits, even low-earning couples may be Social Security millionaires.”

“So, this book is for nearly every one of you who’s ever earned a paycheck and wants every Social Security benefit dollar to which you are entitled-entitled because you paid for it. You earned it. It’s yours.”

“Social Security is the most complicated “simple” program you’re likely to encounter. This book contains minimal math. Rather it explains in the simplest possible terms the traps to avoid and basic strategies to employ in maximizing a household’s Social Security retirement.”

“We will point out Social Security’s windfalls and pitfalls-explain obscure benefits and more obscure penalties; benefit collection strategies like file and suspend (applying for benefits but not taking them)and start, stop, start (starting benefits, stopping them, and restarting them) We’ll also get into details of Social Security’s deeming rules (being forced, in some cases, to take certain benefits early at a very big cost)and related gotchas that can handicap you financially for the rest of your life.”

“We have embraced a model of human behavior based upon a competition among various internal “selves”. So our advice is to enfranchise one of them-the adult within; the long-term planner; the life preserver self. Keep reminding yourself: You are the guardian of your future self.

How was that for a good trailer? Hopefully, you’re enticed enough to put this on the must-read list.

For anyone you care about, please, turn them onto this book, it’s really that good, that important, that valuable, and believe me, they will be extremely grateful you did. As always, my suggestion is to pick this up from your local library. I’m sure there’s a waiting list, but unless you need it urgently, what’s the rush? And local libraries need all the support they can get.

To all my clients, you’re way off the hook as I got you covered. For a numbers/strategy geek like yours truly, this book is my candy store.

To all those with financial advisors already, this book is a must read if your advisor holds themselves out as a comprehensive financial planner or has chosen to work in a fiduciary capacity.

I receive great tips about books, articles related to financial planning or investing, latest tax strategies, you name it; from my clients on a regular basis and I’m very appreciative for that. It’s that collaboration aspect of my work that I love the most. So if you’re not in the habit of emailing your advisor suggestions or inquiring if they have read this book for example, give it a try. Helping them will help you.

Bottom line: Put simply, these three wise authors have ‘cracked the code’ on how to unlock the mystery of claiming Social Security benefits. Read it or listen to the audio book version or make sure your advisor has read it. As the saying goes - just do it!




Tags: book recommendation, investing, retirement planning