Welcome to the Exploring Your Retirement with Willowfinch Series, where we’ll be going over all of the information, dreams, and numbers that can make your plans for “What’s next?” get you somewhere you actually want to go! Today’s post "How to Round Up Your Retirement Numbers" is the first in the bunch. Keep an eye out for the rest in our upcoming blogs!
Before we get into the whats and how-tos, remember that we’re not financial advisors or giving any specific recommendations or advice here. We’re going through the topics that we’ve found helpful when gathering all of these thoughts and showing how they pair up with your Willowfinch account dashboard to get you the most personalized and helpful data possible with our tools and resources. We always recommend getting insight and advice from financial professionals!
What age can you retire and how will it impact your social security? Would relocating give you the savings you need to travel? What about medical costs?
Crafting a plan for your financial future that balances a wide range of information, wants, and needs can be tough.
You can war game possible scenarios to track the impact of changes to each variable, but you need specific projections to get the big picture.
That’s where using Willowfinch as a custom strategic planning tool is so powerful! You’re able to use your own numbers to get personal projections and flip between different combinations to make sure important decisions fit your overall goals. It also makes sticking to the plan as time goes on much simpler. Success can be seen right away and numbers can be adjusted easily if changes need to be made.
Here’s an example of a hypothetical Millennial couple’s initial information:
What Variables Should Be Included in Future Planning
There are a few major categories you should focus on for future planning. Here’s a look at the variables Willowfinch can help address in each one:
Income and career:
- Current and future income
- Possible retirement age
- Social Security starting age and amounts
- Personal circumstances like healthcare, savings goals, loan repayment, education, family costs, and more
Current home and personal expenses:
- Monthly mortgage or rent payment
- Current property tax rates
- Monthly living expenses
- Down payment percentage and monthly payments on the future home purchase
- House and property taxes
- State and local taxes
If there’s an area that is unique for your situation, like a fully paid-off mortgage, you can adjust the variables to show current information or stick with “standard advice” if things could change, just to be on the safe side.
When projecting mortgages on potential future properties, Willowfinch provides the maximum mortgage rather than dealing with different equity amounts. That way you get accurate planning without having to dive too deep into the unknowns of each home’s equity or appreciation. It allows the plan to focus on how the homes and potential purchases impact your plan, not the market. It can account for situational info like the money you’d get from a sale and whether it’s headed to your next home or another investment account.
The Benefits of War Game Scenarios
Running through these kinds of hypotheticals and the projections from Willowfinch brings a lot of benefits.
It’s a starting point to a lot of really important discussions - There are so many small decisions to take into account. Taking the time to think them through and talk them over with key people in your life is essential. This can be your partner, your family, your financial planner, healthcare providers, business partners, or anyone else who will impact or be impacted by your plan.
It gives clear visuals to show the full impact of options - What may seem like a small change in one category can create a big impact in other areas. Being to able see those connections in front of you makes for better understanding and more confident decisions.
A simple example is this possible decision to retire at 68 instead of 65. There’s a $105,000 difference in income over the three-year period:
Pinpointing the best options is simpler - Once you find the right mix of variables, it helps pinpoint target locations. Narrowing things down this way saves time and prevents costly mistakes in house hunting.
It keeps the focus where it should be - Non-negotiables can be locked in while leaving space to play with variables that are more flexible.
It makes communication and tracking easier than ever - Using Willowfinch to pull together millions of data points saves a ton of calculating, researching, and discussing for you and the people you’re working with on your plan, while providing more thorough data for better decisions and results.
You’ll be able to get better advice from professionals and help everyone in your circle feel heard and in the loop, if they need to be. Most of all, you’ll feel confident you’ve considered the key variables and that you’re following a plan you understand and believe in. And you won’t have to chase data or run your own calculations for days to do it! It’s all kept and updated right there for you.
Wondering about your future plans or considering a big move? Let the Willowfinch team and tool put the data that matters to you at your fingertips while you dream. Get in touch with us to get started!