by Barry H. Spencer, author of “The Secret of Wealth With No Regrets”

For many people, saving enough money for retirement is not an easy process, but the COVID-19 pandemic has made the task even more challenging the past two years.

Some who lost their jobs halted their retirement contributions and tapped into their savings. Others, feeling financially stretched, reduced the percentage of money they put toward retirement, and some retired early, perhaps before they were ready. Meanwhile, rising inflation and general uncertainties about the overall economy in 2022, including the state of the stock market, add to the stress and worry about retirement saving and planning as the COVID crisis continues, possibly well into or through the new year.

But no matter the financial climate, many people do not consider the following when planning for retirement:

  • Knowing how much you need to retire
  • Options other than counting mainly on Social Security benefits
  • Using a retirement account that offers tax benefits
  • Taking on more investment risk than you need to
  • Having enough accessible “safe” money for lifestyle

Start with your vision.

Most traditional planning starts with the question, “What are your goals?” On the surface, it seems like a valid question, but in practice, it’s hard to answer, and the answers are usually vague. The reason that question doesn’t lead to the right answers is that goals are what come at the end of the planning process, not the beginning. You shouldn’t start with goals; you should start with vision. Vision leads to priorities, and priorities lead to goals.

Many advisors simply grab a goal sheet from the last client, and everyone gets the same eight goals. It’s assembly-line, cookie-cutter planning. Here’s an example of the difference between a vision and a goal. Let’s say one of your goals is to go on a trip around the world, a goal that is shared by many. What’s unique, however, is the why behind each person’s goals, and the why almost always comes from your vision. Let’s say that when you were little, you had a map in your bedroom. The map had pins all over it because you were interested in tracing your ancestry. Whenever you’d uncover a link to your ancestors in a certain place, you’d mark it with a pin on the map. And you dreamed that one day you would visit every place where your ancestors had laid roots.

So the goal was the trip around the world, but your vision was to tie your legacy to your family, so that your children and grandchildren would know where they came from, and maybe even have the chance to experience the journey that your immigrant grandparents made to get to the United States.

With your vision for retirement in mind, you can start planning, or adjusting your plan, accordingly. Here is a four-phase process:

1. Develop a pyramid of clarity.

This phase is the foundation of the entire planning process. Vision first, priorities next, and once you establish those, you’ll be able to define a set of measurable, specific and unique goals that will lay out what the picture of an abundant retirement looks like.

Growing up, I remember I saw paintings in the doctor’s office of children and happy families around the dinner table. They were famous Norman Rockwell paintings. So if you could wave a magic wand and have the ideal lifestyle in retirement, what would that look like? What’s your ideal legacy?

2. Pitfalls: Uncover side effects in your current plan.

Once you have your sights set on your own unique targets for your best version of retirement, you have to take the time to gain a clear understanding of where you are and where you’ll end up if you keep doing what you’re doing. That means understanding all the side effects and tactical interactions under your current plan, then seeing what happens if you just keep doing what you’re doing.

This involves stress-testing your plan. What are the interactions when you put two financial tactics together? Do you have any idea what the side effects and interactions of your current plan are? Before you think about adding or changing anything, you need to be sure you are solving all the relevant issues, not just solving one issue while creating two or more bigger problems.

3. Blueprint.

Design and refine custom strategies. These are solutions integrated in a way that eliminates the pitfalls and puts you on the road to where you want to go. When you have clarity about your unique picture and the pitfalls of your current plan, it creates a custom filter that can be dropped over all the myriad of solutions, tactics and options – and about two-third of them drop away, which serves to make decision-making easier. Don’t get caught in paralysis by analysis.

4. Action: Implement and adjust.

From this point forward, it is a matter of readjusting your strategies for changes on a regular basis. Your retirement can’t be left on autopilot. Making an adjustment isn’t a no-brainer. It involves careful consideration by a trusted advisor specializing in your situation.

Do not be a do-it-yourself planner. Things have become so much more complex.

The worst thing you can do when it comes to retirement planning is nothing. Some wait too long; others take a set-it-and-forget-it approach that can come back to haunt them. Our times and some facets of the economy are changing rapidly, so to keep from potentially paying dearly for making no decision or suffering from indecision, you have to pay attention. It’s wise to consult a professional planner who can help you avoid common mistakes, develop a vision-first plan, and stay on track for your retirement goals.

Barry H. Spencer is the author of “The Secret of Wealth With No Regrets” and a contributor to three other books. He is a financial educator, industry thought leader and philanthropic and retirement income planning specialist.

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