You have decided to get serious about your retirement planning efforts. You've started reading up on the subject and now are quickly becoming confused. Why? There is simply far too much information out there and deciding which direction to take can be nearly impossible. Instead of making progress on your retirement efforts, you end up frozen in place which is never a good thing.
The key to avoiding such counter productive behavior is to sit down with an independent financial planning professional. Independence is vital because you want to be sure that the person is not beholden to any particular company and their products. Locating such a person can be a matter of reading articles written by people like myself or asking around for referrals from friends and family. Regardless of how you find them, there are going to be certain things you need to communicate to the planner so he or she can put together a plan to meet your goals.
The first thing to discuss with the planner is your retirement goal. No, I don't mean that you want to retire. Instead, I mean what you want to do while you are retired. If your goal is to retire and sail the world, the plan is going to have to be tailored to probably hold and grow money since you will need little while out on the boat unless you plan on buying things from the sharks. Conversely, the desire to travel while staying in luxury hotels each night is going to require a highly monthly income and probably an investment in dividends.
Then there are issues like your business. Most business owners surprisingly never seem to really think about what they are going to do with their business later in life. Do you want to sell it? Do you want to leave it your kids? Each question involves a host of tax and planning issues that have to be dealt with in your plan.
What about choosing between life insurance, 401ks, IRAs and the like? These are planning tools. They are not a plan. Yes, some or all of them will be incorporated into your plan to get you where you want to go, but they are only part of a bigger puzzle. Without an overall plan, they really will not help you reach your goals.
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