Smart Steps
Women business leaders and entrepreneurs from various industries share their tips and advice in a "quick read format" on a variety topics.
Topic: Retirement Strategies for Widows
May 2024
Maddy Pidel
Photo Courtesy: Maddy Pidel |
Maddy Pidel is a financial representative and coach. She loves to support individuals (especially women) in living balanced, joyful and successful lives.
She started in a finance career, pivoted to entrepreneurship for a decade, and is now leveraging financial tools to support successful females at all stages of life. "Take into consideration all the factors for lifestyle, such as where you want to live (near grandkids, family, etc.) when planning, since cost of living varies greatly from region to region." ~ Maddy Pidel |
For many Americans, the default retirement strategies and planning don’t cut it anymore with today’s market volatility, inflation, and other eroding factors to your nest egg. Plus, people are living longer than ever.
Add to that, when you find yourself widowed and planning for retirement, you may be at a loss for where to begin.
To start with: Ensure that you have life insurance as part of your financial picture (before, and even after, loss). This can be one of the key elements to a smooth transition into retirement as a widow.
1. The 75% Rule (with lots of exceptions): A good rule of thumb can be to assume that 75% of your pre-retirement budget will keep you comfortable in retirement; but again, so many factors play into this that it’s better to focus on keeping your cash flow as high and consistent as possible.
Take into consideration all the factors for lifestyle, such as where you want to live (near grandkids, family, etc.) when planning, since cost of living varies greatly from region to region.
2. Know your social security benefit figure: This benefit can be an important one, but you need to know what yours would be going into retirement in order to have an appropriate plan. Additionally, the longer you can continue working (and delay drawing it down) the bigger the benefits will be.
3. Consider an annuity: An annuity can be an efficient way to relieve concerns about outliving your retirement income. An annuity** is a contract between you and an insurance company that gives you guaranteed income in your later years. The key advantage: you can choose to receive payouts no matter how long you live.
Note: Annuities can be structured in different ways, so be sure to speak to a trusted financial professional.
4. Create a three-pronged retirement strategy: To keep liquidity high, maximize your cash flow, and ensure you never run out of money. We’ve seen time and again that this is the best way for our clients to avoid financial failure and stresses in retirement.
Focusing on these areas will bring peace of mind at a time when you most need it.
**Guarantees are subject to the timely payment of all required premiums and the claims paying ability of the issuing insurance company.
Financial Representative of The Guardian Life Insurance Company of America® (Guardian), New York, NY. I.M. FINANCIAL is not an affiliate or subsidiary of Guardian. 2024-173854 Exp 04/26
Add to that, when you find yourself widowed and planning for retirement, you may be at a loss for where to begin.
To start with: Ensure that you have life insurance as part of your financial picture (before, and even after, loss). This can be one of the key elements to a smooth transition into retirement as a widow.
1. The 75% Rule (with lots of exceptions): A good rule of thumb can be to assume that 75% of your pre-retirement budget will keep you comfortable in retirement; but again, so many factors play into this that it’s better to focus on keeping your cash flow as high and consistent as possible.
Take into consideration all the factors for lifestyle, such as where you want to live (near grandkids, family, etc.) when planning, since cost of living varies greatly from region to region.
2. Know your social security benefit figure: This benefit can be an important one, but you need to know what yours would be going into retirement in order to have an appropriate plan. Additionally, the longer you can continue working (and delay drawing it down) the bigger the benefits will be.
3. Consider an annuity: An annuity can be an efficient way to relieve concerns about outliving your retirement income. An annuity** is a contract between you and an insurance company that gives you guaranteed income in your later years. The key advantage: you can choose to receive payouts no matter how long you live.
Note: Annuities can be structured in different ways, so be sure to speak to a trusted financial professional.
4. Create a three-pronged retirement strategy: To keep liquidity high, maximize your cash flow, and ensure you never run out of money. We’ve seen time and again that this is the best way for our clients to avoid financial failure and stresses in retirement.
Focusing on these areas will bring peace of mind at a time when you most need it.
**Guarantees are subject to the timely payment of all required premiums and the claims paying ability of the issuing insurance company.
Financial Representative of The Guardian Life Insurance Company of America® (Guardian), New York, NY. I.M. FINANCIAL is not an affiliate or subsidiary of Guardian. 2024-173854 Exp 04/26
Feel free to reach out for a complimentary consultation or to discuss your specific needs or concerns. We focus on holistic planning and are here to meet you wherever you’re at. The best financial plans are the ones made before anything serious has happened to you or a family member. But it’s never too late to make some smart decisions related to your future.
