You’ve been working hard to achieve your financial goals, dreaming of the days when you will be able to enjoy retirement. But are you doing enough now to ensure you can maintain your accustomed lifestyle into the future? Here, local financial advisers share the most important factors when it comes to setting aside money today for a brighter tomorrow.

Guy Hockerman

VP and senior financial planner, The Commerce Trust Company

GET IN THE GAME. The retirement lifestyle of a high-income individual is often not supportable with retirement plan savings alone. While it’s important to fund company-sponsored retirement plans to the extent allowed, saving money after-tax is almost always a necessary part of a retirement plan for those with high pre-retirement income. For instance, say you retire at age 60 and you’ve managed to save and grow your 401(k) to $3 million. This asset alone will provide only about $100,000 of inflation adjusted after-tax spending over a joint life expectancy. We help our clients develop a game plan for after-tax savings that meets their long-term objectives.

MAKE IT COUNT. Recent tax law changes have raised the stakes on tax-efficient investing for high earners saving for retirement. Along with a 39.6-percent top tax rate, those in the highest tax bracket are now subject to long-term capital gains rates and qualified dividend rates of 20 percent, along with a newly instituted Medicare tax on unearned income of 3.8 percent. This means consideration should be given to not only how much you are saving, but also how tax-efficient those vehicles are in cutting down the year-to-year tax bite.

Julie Sward

Principal, Moneta Group

PAY IT FORWARD. No matter your income level, you should pay yourself first. Make sure to add to your retirement, IRA and/or Roth IRA accounts each year, keeping within the allowable contribution limits. Making saving a priority now means more options when retirement comes.

DO YOUR HOMEWORK. Understand the current tax laws and how they work for (or against) you. You must pay an additional 0.9 percent Medicare tax if you earn more than $250,000 for married couples filing jointly. You also must pay a 3.8 percent tax on your net investment income if your adjusted gross income is more than $250,000 for married couples filing jointly. Your personal exemptions may be phased out and your itemized deductions may be limited if your income exceeds certain limits. By maximizing your pre-tax contributions to your retirement accounts, you reduce the amount of income subject to tax and counted toward the various thresholds, and defer investment income tax going forward.

HIRE A HELPING HAND. With our ever-changing world, both in terms of investments and taxes, it’s never been more important to seek advice and guidance from a qualified adviser who can help you plan for your financial future. Retirement planning, albeit very important, is just one part of a sound, comprehensive financial plan. Working with someone whose expertise encompasses all areas, including investments, tax planning, estate planning and risk management, ensures your goals can be met.

David Presson

Director of investments, First Bank Wealth Management

MAKE IT LAST. People generally are living longer, healthier lives. On average, men live to the age of 84; and women, 87. So you need to plan to have your money last longer throughout the life of your retirement. You should be working with a financial planner who can run various projections for you to ensure you have enough money to last your lifetime and to maintain your lifestyle of choice.

START SAVING EARLY. It’s important to get started early and save a certain amount each year. Let the money compound for you over time. While the rate of return you get on your investments and the allocation of your investments between stocks and bonds will have some impact on the amount of money you have in retirement, the biggest factor will be how much you save and how early you started saving.

DIVERSIFY YOUR INVESTMENTS. As you plan for your retirement, it’s important to diversify your investments, as well as your investment accounts. You should have a 401(k) plan, an IRA or another qualified plan, where your money can compound tax-deferred until you begin to take it out during retirement, but it’s also important to have a regular investment account. Remember any money you take out of a qualified retirement plan will be taxed at whatever your ordinary tax rate will be in the future. We don’t know what those tax rates will be, but they could eat up a big chunk of how much is available each year. That’s why it’s important to have a taxable account, where any money you withdraw will not carry taxable implications.

Lori Heise

Co-founder, Heise Group

PRESERVE YOUR ASSETS. The closer you get to retirement, say within three to five years, you need to begin to transition more of your assets into safety and into vehicles that can produce steady, predictable income for life.

AVOID PITFALLS. When you are so close to retirement, a market loss can have such a huge impact that you may not be able to retire and the time to recover may not be there.

Ken Poteet

Chairman/CEO, Sterling Bank

EDUCATE YOURSELF. Have a keen understanding of how established monetary and fiscal policies affect one’s ability to maximize earnings and total return within varied risk limits.

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