Retirement Planning?

Retirement planning is a topic that threatens to send many people to sleep. But when you look at retirement as a potential two or three decade period at the end of your life, where you will have total freedom to do whatever you like within reason, it seems ridiculous to just leave it to fate.

Stopping full time work permanently may seem like such a distant dot on the horizon – there’s always something on, mortgages to pay, children to rear and then get through university – but life may be slightly dull – the state pension may not keep you in the habit to which you are accustomed.

A single person has $277 a week to live on and a couple has $426 a week – not much left over for holidays.”The whole idea about retirement planning is to develop enough other assets that in the future can generate a regular income [rent, dividends, interest] that will replace your work income,” says Spicers Wealth Management senior financial adviser Jeff Matthews.

Goal setting in writing

Ideally you should start retirement planning in your 20s, but most twentysomethings have other things on their mind. Not many in their 30s give it much mind space either but by the time your 40th birthday comes around, it should be a “real wake-up call”, says author of Twenty Good Summers and wealth coach Martin Hawes.

The first step all financial advisers will ask you to take is to set out some goals.

Do you want to retire when you are 65 and go and live on a Greek island or do you want to work part time between 60 and 70, then sell the family home and take up painting in the Bay of Plenty?

Write down whatever these goals are – you have a much better chance of them happening that way, says Hawes.Then, comes the hard part, you need to crunch the numbers – how much do you think you will need to live on in 20 years time?

You can either go to the excellent Sorted.org.nz for an inflation adjusted calculator or, if you feel you need the reassurance of an expert, go and see a financial adviser. They do this for people every day. All the experts agree that to eradicate debt is the first piece of action after the goalsetting plan. “Pay off the mortgage – you can’t earn anything more in another investment that is risk free and it’s tax efficient,” says Susanna Stuart, financial adviser at Stuart + Carlyon.

Start as you mean to go on

It’s what you do at the beginning of your working life that matters, says Spicers’ Jeff Matthews. He recently met up with some well-off Americans visiting Auckland on a cruise ship who were all patently enjoying their retirement in some luxury. They all had one thing in common – they had been putting money away their whole working lives into various pensions, military, corporate pension funds etc. In some cases they had several pensions on the go. On top of this they had investment portfolios with the spare cash they had after they had paid their mortgages off.

“It was a three or four-legged approach rather than a one-legged approach,” says Matthews.You can always justify why you can’t set up a pension, he says. “People pay rent, mortgage, gym membership, coffee everyday but never put money aside – there’s hardly any money left so why should they bother?”It’s a mindset of getting people to pay themselves first,” he says.

Changing trends in retirement

If you are 65, and you are a woman, your life expectancy is 85. As John Nelson, co- author of What Colour is Your Parachute: For Retirement says, you may easily live more years than it took you to get through school.

People are living for longer, and need income producing savings.Retiring cold turkey is perceived as too big a change for people to cope with and unnecessary.

It is better to discuss a phased retirement with your employer so you get used to having some free time. Employers are becoming far more amenable to employing people in their later years and value older staff’s expert knowledge.

People are working for longer in many cases because they want to.The introduction of the voluntary work-based savings initiative KiwiSaver, with tax incentives is something which the Government hopes will help people be better prepared for retirement.

A good idea before you leave fulltime employment, is to have a house maintenance expert in who can tell you what costs to your house you will have to pay in the next 10 years. It might be a new roof or a deck needs replacing. You don’t want any nasty surprises when there is no salary coming in any more. It’s also wise to buy some near new appliances which will last you well into retirement.

A lot of people also invest in a late model car. A lot of people downsize from larger family homes to smaller apartments or units. It does depend on what the property market is doing. One of the best ideas at the moment if you are retired, is to rent and put the proceeds from your house into an income producing savings account.”Renting at the moment is the bargain of the century. You get such a big capital asset for such a small amount of money,” says Martin Hawes.

Home Equity Release

Babyboomers are moving into retirement age, and this SKI (Spend the Kids Inheritance) generation is going to grow. By 2021 the over-50s market will grow by 27 per cent, according to advertising network Senioragency. They have worked hard and they intend to enjoy themselves. They figure they have lavished everything on their children growing up from braces, to holidays to tertiary education.

One of the new financial products the SKI generation are more than happy to factor into their lives later on, is Home Equity Release. Home equity release finance allows asset-rich, cash-poor to pay for big items.

According to the Consumers’ Institute, a “reverse” mortgage is just that – a mortgage where you don’t make payments until the end of the mortgage period(which is usually when you sell your home or move out). The mortgage is secured against your home and you remain the legal owner until you sell. Interest and fees are added, so the loan balance increases.

Cautious financial advisers tell their clients to use Home Equity Release as a last resort, certainly not to go round the world in their early 60s with it but wait until later.”The longer you can leave it the better,” agrees Hawes. But as we are only here once, you’d better get on with it.

NZ Herald

5:00AM Friday March 14, 2008
By Gill South

Retirement Planning

Retirement planning is a topic that threatens to send many people to sleep. But when you look at retirement as a potential two or three decade period at the end of your life, where you will have total freedom to do whatever you like within reason, it seems ridiculous to just leave it to fate.

Stopping full time work permanently may seem like such a distant dot on the horizon – there’s always something on, mortgages to pay, children to rear and then get through university – but life may be slightly dull – the state pension may not keep you in the habit to which you are accustomed.

A single person has $277 a week to live on and a couple has $426 a week – not much left over for holidays.”The whole idea about retirement planning is to develop enough other assets that in the future can generate a regular income [rent, dividends, interest] that will replace your work income,” says Spicers Wealth Management senior financial adviser Jeff Matthews.

Goal setting in writing

Ideally you should start retirement planning in your 20s, but most twentysomethings have other things on their mind. Not many in their 30s give it much mind space either but by the time your 40th birthday comes around, it should be a “real wake-up call”, says author of Twenty Good Summers and wealth coach Martin Hawes.

The first step all financial advisers will ask you to take is to set out some goals.

Do you want to retire when you are 65 and go and live on a Greek island or do you want to work part time between 60 and 70, then sell the family home and take up painting in the Bay of Plenty?

Write down whatever these goals are – you have a much better chance of them happening that way, says Hawes.Then, comes the hard part, you need to crunch the numbers – how much do you think you will need to live on in 20 years time?

You can either go to the excellent Sorted.org.nz for an inflation adjusted calculator or, if you feel you need the reassurance of an expert, go and see a financial adviser. They do this for people every day. All the experts agree that to eradicate debt is the first piece of action after the goalsetting plan. “Pay off the mortgage – you can’t earn anything more in another investment that is risk free and it’s tax efficient,” says Susanna Stuart, financial adviser at Stuart + Carlyon.

Start as you mean to go on

It’s what you do at the beginning of your working life that matters, says Spicers’ Jeff Matthews. He recently met up with some well-off Americans visiting Auckland on a cruise ship who were all patently enjoying their retirement in some luxury. They all had one thing in common – they had been putting money away their whole working lives into various pensions, military, corporate pension funds etc. In some cases they had several pensions on the go. On top of this they had investment portfolios with the spare cash they had after they had paid their mortgages off.

“It was a three or four-legged approach rather than a one-legged approach,” says Matthews.You can always justify why you can’t set up a pension, he says. “People pay rent, mortgage, gym membership, coffee everyday but never put money aside – there’s hardly any money left so why should they bother?”It’s a mindset of getting people to pay themselves first,” he says.

Changing trends in retirement

If you are 65, and you are a woman, your life expectancy is 85. As John Nelson, co- author of What Colour is Your Parachute: For Retirement says, you may easily live more years than it took you to get through school.

People are living for longer, and need income producing savings.Retiring cold turkey is perceived as too big a change for people to cope with and unnecessary.

It is better to discuss a phased retirement with your employer so you get used to having some free time. Employers are becoming far more amenable to employing people in their later years and value older staff’s expert knowledge.

People are working for longer in many cases because they want to.The introduction of the voluntary work-based savings initiative KiwiSaver, with tax incentives is something which the Government hopes will help people be better prepared for retirement.

A good idea before you leave fulltime employment, is to have a house maintenance expert in who can tell you what costs to your house you will have to pay in the next 10 years. It might be a new roof or a deck needs replacing. You don’t want any nasty surprises when there is no salary coming in any more. It’s also wise to buy some near new appliances which will last you well into retirement.

A lot of people also invest in a late model car. A lot of people downsize from larger family homes to smaller apartments or units. It does depend on what the property market is doing. One of the best ideas at the moment if you are retired, is to rent and put the proceeds from your house into an income producing savings account.”Renting at the moment is the bargain of the century. You get such a big capital asset for such a small amount of money,” says Martin Hawes.

Home Equity Release

Babyboomers are moving into retirement age, and this SKI (Spend the Kids Inheritance) generation is going to grow. By 2021 the over-50s market will grow by 27 per cent, according to advertising network Senioragency. They have worked hard and they intend to enjoy themselves. They figure they have lavished everything on their children growing up from braces, to holidays to tertiary education.

One of the new financial products the SKI generation are more than happy to factor into their lives later on, is Home Equity Release. Home equity release finance allows asset-rich, cash-poor to pay for big items.

According to the Consumers’ Institute, a “reverse” mortgage is just that – a mortgage where you don’t make payments until the end of the mortgage period(which is usually when you sell your home or move out). The mortgage is secured against your home and you remain the legal owner until you sell. Interest and fees are added, so the loan balance increases.

Cautious financial advisers tell their clients to use Home Equity Release as a last resort, certainly not to go round the world in their early 60s with it but wait until later.”The longer you can leave it the better,” agrees Hawes. But as we are only here once, you’d better get on with it.

NZ Herald

5:00AM Friday March 14, 2008
By Gill South

What is the financial planning process?

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baileyFinancial Planning is a process, it is a confusing and often daunting process for many people however it is a process that we deal with every day and we work hard to ensure our clients are kept informed every step of the way

We have quality procedures in place to ensure we fully understand your current financial situation, goals and dreams.

Our process differs from others in that we carefully analyse your complete financial position in terms of understanding your goals and needs, while highlighting your financial planning issues, all without cost or obligation, ensuring you have time to arrive at an informed decision to employ our services.

We regularly review your situation to keep your informed and to build the client relationship we consider so important.

Our system brings into clear focus precisely what is realistically feasible. The fact that we do this at no cost initially is testament to the fact that we retain our clients for the long term. Building wealth is one thing but what’s the point if you don’t have personal goals and dreams as well.

The Financial Planning Process is made up of 6 steps.

1. Find a Professional Investment Services Wealth Coach

Contact your local Professional Investment Services Office and a registered Wealth Coach near you will be in touch to arrange the initial consultation.

2. Checklist: Preparing for the first interview

Prior to the first interview, it is recommended you consider your financial and lifestyle objectives for the short, medium and long term.

These may include:

*Wealth creation

*Savings capacity

*Income requirements present & future

*Retirement planning

*Lifestyle needs

In addition, we recommend you compile the following documents (listed below) for the initial interview to enable your Wealth Coach to obtain a clear understanding of your present financial position.

*Personal investment details including investment and rental statements

*Tax returns

*List of liabilities eg. amount and applicable interest rates

*Additional assets

3. Initial consultation

On first meeting with a Professional Investment Services Wealth Coach, they will provide you with a disclosure statement which outlines their;

*Qualifications

*Responsibility for advice given

*Restrictions applying to advice given

*Fees and charges

*Complaint resolutions schemes available

*Privacy information

The first meeting objective is to ascertain current position, expectations, future objectives and risk profile. This is achieved by asking a series of personal and lifestyle questions supplied in a client data form.

At the conclusion of the meeting, the Wealth Coach will seek your commitment to prepare written recommendations that addresses your financial situation and will detail any fees that apply to this process.

4. Written Recommendations

After preparing the written recommendations your Wealth Coach will meet with you to go through it step by step and answer any questions that may arise. You must also confirm that the details within the written recommendations are correct.

At the conclusion of this meeting, your Wealth Coach may schedule a follow-up to answer any further questions.

5. Implementation

If you are happy with the recommendations and wish to these, your Wealth Coach will ask you to sign an ‘Authority to Proceed’ that formally documents your consent.

Your Wealth Coach will assist you with the implementation process including completing forms and lodging the applications.

6. Review and service

Maintaining ongoing review and service of your financial plan is vitally important to achieving the optimum results in your financial future.

Many variables in your life can change over time impacting on the suitability of your investment portfolio.

At a minimum, Professional Investment Services recommends annual review of your financial plan to ensure it continues to meet your needs

What Services Can You Provide?

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money2At Professional Investment Services we can provide a comprehensive range of services that will ensure you, our client is cared for in the manner you expect.

The following is a list of our services. We are also strategically placed to introduce you to other industry professionals who may be of assistance to you should the need arise.

* Financial Planning

* Budgeting

* Wealth Creation

* Investment Planning

* Cash Management

* Loan Facilities

* Debt Structuring

* Debt Management

* Debt Consolidation

* Insurance Services

* Retirement Planning

* Superannuation

* Stock Broking Facilities

* Tax Planning Strategies

* Estate Planning

* KiwiSaver

* Portfolio Construction

* Real Estate Investment Advice

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