7 Ways 70s Investors Can Prepare for 2023

For many investors in their 70s, this retirement decade provides time for desires such as travel, quality time with growing family and friends, and the pursuit of hobbies that were previously difficult to accommodate.

But all of this costs money, and retirees are wondering how much they can spend in retirement without outliving their money.

“Determining a stable withdrawal rate, or expense rate as I prefer, is an important part of retirement planning, and pre-retirees and retirees who need guidance should seek the help of a financial advisor for this part of the planning process. says Christine Benz, director of personal finance at Morningstar.

At a minimum, he adds, anyone entering retirement should understand the basics of expense ratios. how to calculate them, how to make sure their costs pass the sustainability test given their time horizon and asset allocation, and why that might be. to adjust valuable cost rates over time.

Retirees may also have other questions, including:

  • Should I adjust my costs in this environment?
  • Will my equity continue?
  • Can I do anything smart to generate more income from my portfolio?
  • How do I avoid making big mistakes that will leave me penniless?

To help with some of this, the team at Morningstar Investment Management has some tips.

7 Actions for Investors in their 70s to Consider

  1. Enjoy your wealth. We can be overprotective when we stop working. However, an individualized approach, including a clear succession plan, can help you enjoy your wealth. you’ve worked hard to get to this point.
  2. Think about your withdrawal strategy. Investors in “withdrawal mode” can become defensive and short-term oriented. A portfolio bucket approach can help clients stay focused for the long term.
  3. Focus on results, especially cash flow. When investors retire, results become far more important than relative gains. Tie results to their goals, with a specific focus on financing your retirement cash flow needs.
  4. Supporting others. You may need to balance your own financial security with sharing your wealth with others. An income-oriented portfolio can help by distributing to others while preserving capital for future use.
  5. Behavioral learning about succession risk. Research shows that behavioral training can add significant value. Or conversely, bad behavior is destructive. Understand sequence risk with good investment principles and related habits in mind.
  6. Consider different portfolio combinations. Achieving goals is an individual experience and tracking the TSX Composite or S&P500 is not for everyone. Embrace portfolio combinations you feel positive about, but don’t overcomplicate your investments.
  7. Prepare for a post-retirement crash. You will likely experience at least one market crash during your retirement. Your response to these events will determine your ability to preserve capital. The better prepared you are, the less likely you are to make mistakes.


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