​Are you one of the millions of Americans using a qualified plan such as a 401(k) or 403(b) to save for retirement? Do you also contribute to a traditional or Roth IRA? These vehicles are powerful retirement accounts because they offer tax-deferred growth. That means you avoid paying taxes on growth while the assets are in the account.
 
While you may have an idea of the balance of your accounts, have you estimated the potential income your qualified accounts will generate in retirement? If you answered no, you’re not alone. A recent study from the LIMRA Secure Retirement Institute (LIMRA SRI) found that more than half of all workers don’t know how their retirement assets will translate into income.1
 
The LIMRA study found that a retirement income estimate can boost your confidence in your retirement strategy. Almost 70 percent of the surveyed participants said they were more confident in their ability to retire after estimating their income. Of those who hadn’t estimated their income, only 30 percent were confident.1
 
You can use a retirement income estimate to gain insight into your planning and make important changes. You may see that you need to increase your contributions or perhaps make a change to your allocation. Below are a few tips on how to use a retirement income estimate in your planning:
​
Consolidate and analyze your retirement accounts and income sources.
 
There was a time when people worked for the same employer for most of their career. Those days are long gone. Today, many people make multiple job changes throughout their career. Each time they do, they may leave a 401(k) account behind at their old employer. It’s possible that you have old 401(k) plans and IRAs spread across multiple employers and financial institutions.
 
The first step in developing your retirement income estimate is to make an inventory of your accounts and assets. Gather statements from your investment accounts. Contact old employers to get information on old 401(k) balances, deferred compensation and even pension benefits. You can also use a tool on the Social Security Administration’s website to estimate your benefits.
 
Once you’ve gathered that information, consolidate it in one report. You may need to work with a financial professional to convert your balance information into an income estimate. However, adding up your total assets and income is a good first step.

Estimate sustainable withdrawal rates.
 
Once you’ve gathered your balance information, the next step is to project your retirement income. There are a few ways to do this, including some simple formulas for a quick estimate.
For example, you might assume that you can withdraw 4 percent of your retirement assets each year, as that would hypothetically last 25 years.
 
Be careful with quick estimates, though. They’re not always accurate. Your income is likely to fluctuate throughout your retirement. Also, your cost of living may increase because of inflation and rising health care costs. Your asset values might fluctuate, causing you to change your withdrawal amount. A quick estimate doesn’t account for those variables.
 
A more effective approach may be to work with a financial professional to run retirement withdrawal simulations. For example, your financial professional may be able to use software to model different rates of return and withdrawal amounts to show you what is sustainable in retirement. That could give you more confidence or help you identify areas for adjustment.

Develop a retirement budget and adjust your plan as needed.
 
A budget is always a helpful financial tool, but it’s especially powerful when planning for retirement. You can project your retirement expenses based on your current spending and inflation. You can then compare your estimated spending with your projected retirement income.
 
If your income exceeds your expenses, you may be on the right track. If there’s a gap, you may need to do more work and consider saving more money to reach your retirement goal.

Again, this is a process in which you may benefit from speaking with a financial professional. They have experience building retirement budgets and can advise you on costs and issues that you may not have anticipated.
 
Ready to estimate your income and boost your retirement confidence? Let’s talk about it. Contact us today at Sprouse Financial Group. We can help you analyze your needs and develop a plan. Let’s connect soon and start the conversation.
 
1https://www.limra.com/Posts/PR/Industry_Trends_Blog/More_Than_Half_of_All_U_S__Workers_Have_Difficulty_Understanding_Retirement_Savings_in_Terms_of_Future_Monthly_Income.aspx

Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
18184 - 2018/10/22

​Do you have an estate plan? It’s an important part of any long-term financial strategy, especially as you enter retirement. An estate plan addresses your assets and how they should be distributed after you pass away. It can help make sure those assets go to the correct heirs and that your family is taken care of after you’re gone.
 
You can also use your estate plan to eliminate taxes and other costs. Estate taxes are usually only an issue for the ultrawealthy, but there are other expenses and complications your heirs could face.
 
One of the biggest potential costs is probate. That’s the legal process for settling one’s estate. Every estate goes through probate, even if a will exists. The probate process usually includes tasks such as notifying heirs, paying debts, selling property and filing taxes. Probate can take weeks or even months, and it can delay the distribution of assets. It can also be expensive, as your estate may need to hire attorneys, accountants and others.
 
Fortunately, there are steps you can take to eliminate the impact of probate on your estate. Below are three such steps. If you haven’t planned for probate, now may be the time to do so. These steps could ease the process for your heirs after you pass away.

Gifting
 
One of the best ways to minimize the impact of probate is simply to remove assets from your estate. You can do this by gifting assets to heirs and loved ones while you’re still alive. Be careful, though. Many states have laws about how long an asset must be out of your estate for it not to be included in probate.
 
There are also gift tax and income tax laws that apply to gifting. You’ll likely want to consult with a financial professional to see how those laws apply to your strategy. Finally, be sure to consider how your loved ones may feel about the gifts. Some may feel that the gifts aren’t fair. If the gifts will create conflict, you may want to consider an alternate plan.

Trust
 
A trust is another effective strategy for minimizing the impact of probate. A trust is a legal document that’s used to manage investments, savings, property and other assets. You create the document with the help of a legal or financial professional, and then retitle assets to ownership by the trust.
 
Upon your death, the assets are distributed to your trust beneficiaries. Since you name the direct beneficiaries in the trust, the assets bypass probate. That could help your heirs receive their inheritance faster and at less expense.

Life Insurance, Annuities and Qualified Accounts
 
Trust assets aren’t the only assets that bypass probate. Any account with a beneficiary designation avoids the probate process. That includes life insurance, annuities and qualified accounts such as IRAs and 401(k) plans.
 
Consider ways you can maximize these assets to take advantage of the probate bypass. For example, you may consider putting assets into an annuity. Many of these products have other attractive features like guaranteed* rates of return and market risk protection. A financial professional can help you determine the best strategy for your needs.
 
Ready to develop your probate plan? Let’s talk about it. Contact us today at Sprouse Financial Group. We can help you analyze your needs and develop a strategy. Let’s connect soon and start the conversation.
 
*Guarantees, including optional benefits, are backed by the claims-paying ability of the issuer, and may contain limitations, including surrender charges, which may affect policy values.
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
18086 – 2018/10/1

​​For many Americans, early retirement is the ultimate dream. Making the dream a reality requires focus and disciplined saving. Unfortunately, many workers may not be able to achieve their dream of early retirement. According to an analysis of the Federal Reserve’s 2013 Survey of Consumer Finances, the average American couple has only $5,000 saved for retirement.1
 
Some workers, however, may be in a strong enough financial position to leave their career early and start living life on their terms. Think you fall into that group? Below are a few questions to ask yourself. If you can answer these questions, early retirement may be in your future:

Do you have a strategy to pay for health care?
 
According to Fidelity, the average 65-year-old retired couple can expect to spend $280,000 in retirement on things like deductibles, premiums, copays and more.2 That figure doesn’t include any potential long-term care costs.
 
Do you have a plan to pay for medical expenses? If you retire early, you may have to pay out of pocket or buy a private policy before you’re eligible for Medicare. Consider maxing your contributions to your health savings account (HSA) and possibly looking into a long-term care insurance policy.

Do you have a retirement spending budget?
 
A budget can be your most powerful financial tool in retirement. It helps you see where you spend your money, how much you can afford to spend and what changes you may need to make to stay within your income.
 
Developing a budget is only the first step, though. You also may want to take your retirement budget for a test drive. That’s especially true if you hope to live on a tighter spending level after you retire. Try living on that spending level for three or even six months to see if it’s feasible. If so, retirement may be a possibility.

How will you spend your free time?
 
Retirement planning isn’t only about your finances. You should also know how you will spend your time in retirement. What’s important to you? What activities do you enjoy? What do you want to accomplish?
 
Many retirees have a challenging time transitioning to a wide-open schedule. They fill that time with costly activities such as travel, shopping and expensive hobbies. The result is that they spend too much money in the early years of retirement and leave themselves in a challenging position in the later years.
 
If you don’t know how you will spend your retirement, you may not be ready to stop working. Develop a plan not only for your money in retirement, but also for your time.
 
Wondering if you’re ready to retire early? Contact us at Sprouse Financial Group. We can help you analyze your needs and objectives and determine whether early retirement is right for you. Let’s connect soon and start the conversation.
 
1http://www.marketwatch.com/story/the-typical-american-couple-has-only-5000-saved-for-retirement-2016-04-28
2https://www.fidelity.com/about-fidelity/employer-services/a-couple-retiring-in-2018-would-need-estimated-280000
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
18087 – 2018/10/1

​Life can change quickly. When it does change, it’s helpful to review your financial strategy and make sure it still aligns with your needs and goals. Of course, life can also be hectic, so it’s easy to forget to review investment accounts, retirement plans and important financial documents.
 
If you own life insurance, it’s possible that you haven’t reviewed your coverage in years. Maybe you’ve never reviewed it. After all, life insurance operates in the background. It provides protection when you pass away, so you may not feel a need to review it. It’s a financial tool that you hope never gets put to use.
 
However, there are some changes in life that can have a sizable impact on your life insurance needs and protection. Below are a few such changes. If any of these sound familiar, it may be time to meet with your financial professional and review your coverage.

The number of dependents in your home changed.
 
Having a child is a major life change in many ways, but it’s an especially sizable change to your financial strategy. Your child is completely dependent on you for food, shelter and a wide range of other needs. If you pass away unexpectedly, your child could be in a financially challenging situation. Life insurance helps mitigate that financial risk.
 
Similarly, your financial strategy could change when your child moves out of the home and becomes financially independent. If they’re no longer dependent on you for financial support, you may not need as much life insurance. Whether you’ve added a child or recently become an empty nester, take time to review your coverage and make sure it’s appropriate.

You got married or divorced.
 
Your spouse also may be dependent on you for financial support. If so, your death could be a financial disaster for them. Again, life insurance is a helpful tool to provide financial support to your spouse in the event of your death.
 
If you recently divorced, you may want to check and see if your life insurance is still necessary. Also, be sure to check your beneficiaries. If you don’t make a change, your ex-spouse could get a large life insurance benefit that should have gone to a child or other loved one.
 
You changed jobs.
 
Very few people stay with one employer their entire career anymore. Anytime you change jobs, it’s wise to review your life insurance protection. You may have been dependent on robust group life coverage at your old job. If your new job doesn’t offer such protection, you may want to fill in the gaps with an individual policy. Also, if your income increased substantially with the job change, you may need more coverage to replace your income if you pass away.
 
Ready to review your life insurance strategy? Contact us today at Sprouse Financial Group. We can help you analyze your needs and adjust your plan. Let’s connect soon and start the conversation.
 

Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
17962 – 2018/9/4

​Nearly 56 percent of Americans don’t own life insurance. Among those who do, 40 percent say they don’t have enough. Are you a part of those groups? Life insurance ownership has been on the decline for decades. In fact, LIMRA, an insurance industry organization, estimates that Americans as a group are underinsured by more than $15 trillion.1
 
There are many reasons why people don’t buy life insurance. You may buy into some of those reasons. However, if your death would cause financial hardship for someone else, you probably need some level of protection.
 
There are a wide range of different types of policies available, so you can likely find one that fits your needs and budget. If you’ve been avoiding the purchase of life insurance, you may want to reconsider. It’s possible that you’ve bought into false ideas. Below are a few common myths about life insurance and why you shouldn’t believe them:

Life insurance costs too much money.
 
The most popular reason why people don’t buy life insurance is that they believe it’s too expensive for their budget. According to LIMRA, 83 percent of those who don’t have life insurance say they believe it’s too expensive. Another study found that most Americans believe life insurance costs more than double what it actually does.1
 
A term life policy could help you get the coverage you need and stay within your budget. These policies provide temporary protection for a set period of time, such as 10 or 20 years. Because the coverage is temporary, term policies are usually more affordable than permanent insurance. A financial professional can help you find the right policy for your budget.

I don’t need individual life insurance if I have it at my work.
 
Does your employer offer life insurance? It’s a common element in group benefit packages. Some group life coverage may be free, while additional coverage could be available at a relatively low cost. If you participate in your employer’s group life insurance plan, you may not feel that you need additional insurance.
 
Group insurance is helpful, but you still may need an individual policy. If you leave your employer, you’ll likely lose your insurance. If your health has declined, you may not be eligible to purchase insurance after leaving your job. Of course, you can avoid that risk by purchasing an individual life insurance policy today.

I’m not going to die soon so I don’t need coverage.
 
No one likes to think about dying. If you’re young and healthy, death may not be on you radar. After all, there are probably more pressing risks and needs to consider.
 
However, when you’re young and healthy is usually the best time to buy life insurance. Your premiums are based on the probability of you dying relatively soon. If you purchase when you’re young, there is a low probability of that happening, so you get a lower premium. If you wait until you’re older, your premiums could be substantially higher. You can save yourself significant money over the course of your life by purchasing life insurance at a young age.
 
Ready to find the right protection for your needs and budget? Let’s talk about it. Contact us today at Sprouse Financial Group. We can help you analyze your needs and develop a plan. Let’s connect soon and start the conversation.
 
1https://www.thinkadvisor.com/2013/08/30/the-shocking-statistics-behind-the-life-insurance/?slreturn=20180727144059
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
17964 – 2018/9/4

​​If you’re approaching retirement, it’s likely that you’ll have to make a decision about filing for Social Security at some point. Social Security provides income to more than 45 million retirees and their dependents. In fact, 90 percent of those over the age of 65 rely on Social Security retirement benefits for income.1
 
Your Social Security benefit amount is based on a few factors. Your career earnings play a large role, but so too does your decision on when to file. Generally, the earlier you file, the lower the benefit amount. On the other hand, the earlier you file, the more years you will receive benefit payments.
 
There’s no universal right answer on when to file for Social Security benefits. The decision should be based on your own unique needs, goals and objectives. Below are a few guidelines to keep in mind as you decide on when to file:

Before Your FRA
 
You can file for benefits as early as age 62. However, any filing before your full retirement age (FRA) is considered early, and you will likely face a benefit reduction. The closer you are to your FRA when you file, the lower the reduction. For instance, if your FRA is 67 and you file at age 62, your benefit is reduced 30 percent. If you file only a year before your FRA, the benefit is reduced 6.7 percent.2
 
It’s important to remember that these reductions are permanent. If you file early, your benefit never reverts to the full amount, even when you hit your FRA. You may get increases in the future for cost-of-living adjustments, but you’ll always be below the amount you would have if you’d waited until your FRA.
 
However, that doesn’t necessarily mean filing early is always bad. If you file five years early, that means you get an additional five years of payments, albeit at a reduced amount. If you don’t live long into retirement, it could turn out that filing early was the wiser option.

At Your FRA
 
Filing at your FRA allows you to get a full benefit. If you wait until the month of your FRA, your benefit amount is based entirely on your earnings and is not reduced. Most people reach their FRA between their 66th and 67th birthdays.
 
If you plan on working in retirement, it also may pay to wait until your FRA to file. After your FRA, you can earn as much as you want without seeing a reduction in your benefits. If you file before your FRA and continue working, your benefit could be reduced because of your earnings.

After Your FRA
 
If you want the highest benefit possible, you may want to wait beyond your FRA to file. You can delay your filing all the way to age 70. The Social Security Administration offers an 8 percent benefit credit for every year past your FRA that you wait. For example, if your FRA is 66 and you delay your filing to age 70, you could permanently increase your benefit by 32 percent.4
 
Ready to plan your Social Security strategy? Let’s talk about it. Contact us today at Sprouse Financial Group. We can help you analyze your needs and develop a plan. Let’s connect soon and start the conversation.
 
1https://www.ssa.gov/news/press/factsheets/basicfact-alt.pdf
2https://www.ssa.gov/planners/retire/applying2.html
3https://www.ssa.gov/planners/retire/retirechart.html
4https://www.ssa.gov/planners/retire/delayret.html
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
 
The material is not intended to be legal or tax advice. The insurance agent can provide information, but not advice related to social security benefits. Clients should seek guidance from the Social Security Administration regarding their particular situation. The insurance agent may be able to identify potential retirement income gaps and may introduce insurance products, such as an annuity, as a potential solution. Social Security benefit payout rates can and will change at the sole discretion of the Social Security Administration. For more information, please consult a local Social Security Administration office, or visit www.ssa.gov
 
17846 – 2018/7/30