Cheers to Your Health, Wealth and Wisdom!

Dear Clients and Friends,

Happy New Year! As I look at this picture of Queen Elizabeth II and former President Ronald Reagan, I am reminded of the love, tradition, respect, and hope in our lives that we can celebrate as the new year turns. It has also become the annual occasion to reflect on such things and to craft resolutions and goals that are meant to shape our new year.  I believe that nearly all New Year’s resolutions have these three things in common – they are focused on some form of health, wealth and wisdom, akin to the old adage of “healthy, wealthy, and wise.”

As wealth advisors, it is our passion to not only help you set goals to grow and preserve wealth but to help you set goals that are holistic and comprehensive, deeply rooted in the things that matter most.  And that in all things that you dream to accomplish, prudent planning remains a steadfast strategy for success.

When life seems hard, the courageous do not lie down and accept defeat; instead, they are all the more determined to struggle for a better future.” – Queen Elizabeth II

Live simply, love generously, care deeply, speak kindly, and leave the rest up to God.” – Ronald Reagan (40th President of the United States)

It’s important to remember the distinction between resolutions and goals, as it will help you be more successful in their achievement. A resolution is a statement of what you want to change in your life, such as “I want to save money.” A goal is a very specific statement of what you want to achieve or an ongoing habit you want to acquire. According to management consultants Doran, Miller, and Cunningham, goals need to be S.M.A.R.T. This acronym stands for S. – Specific, M. – Measurable, A. – Achievable, R. – Realistic, and T. – Time-based. Therefore, restating the above resolution as a goal, you would say “I want to save $5,000 by June 1, 2019.” My friend, Dr. John Townsend, an executive leadership coach and psychologist, says that to make your goals more motivational, you should write your “why” next to the goal and share it with an accountability partner. Taking this all together, your goal would then be restated to say, “I want to save $5,000 by June 1, 2019, so I can take my family on a Summer vacation.” Or in my case, “I want to lose 10 lbs. by June 1, 2019, so that I can fit into my swim trunks on a Summer vacation and not embarrass my family.”

As wealth advisors, it is our passion to not only help you set goals to grow and preserve wealth, but to help you set goals that are holistic and comprehensive. In this year’s Financierge, we will focus the core insights that reflect the diversity of services and thought leadership we provide clients through our Financial Concierge Services platform rotating through retirement planning, estate planning, business planning, accounting and tax, real estate, risk management, philanthropy, family and lifestyle management, and family office.

In this issue of the Financierge, we focus on retirement planning.


As in all successful ventures, the foundation of a good retirement is planning.” — Earl Nightingale

Retirement Planning for Long-term Financial Security

Whether you are just starting your career, mid-way to retirement, or in retirement, planning is something we must all do to achieve the goal of long-term financial security. For some clients, long-term financial security extends beyond their own personal retirement planning to their family, business and philanthropic legacy planning. Our objective is to help you create a S.M.A.R.T. retirement and legacy plan that keeps you on the right track toward achieving sustainable, long-term success. The following are some of our insights into retirement planning.

Start Saving for Retirement Early – This is the accumulation phase of your retirement planning.  If you want a general estimate of how much you will need to save for retirement, you can use a general benchmark like saving 15% of your salary. Obviously, if you save 15% of your income at age 64 and expect to retire at 65, you may be a little optimistic. For a more sophisticated benchmark, you can use 25 times your annual retirement expenses minus your social security benefits. For instance, if you plan to live on $16,000 a month in retirement and anticipate $4,000 a month in Social Security income, your net need is $12,000 a month ($144,000 annually). Therefore, your benchmark retirement savings amount would be $144,000 times 25, or $3.6 million. Other considerations to help your retirement plan may include working longer, getting a part-time job, living on less money, and saving more. Three key considerations for retirement planning is your age, when you want to retire, and your life expectancy. According to the U.S. Department of Health and Human Services, the average life expectancy in the U.S. is currently 78.7 but expected to pass 80 in a few years. Some children born today will live to 120. There are many factors that play a role in life expectancy. If you are interested, click on this link and try the age calculator at It predicts your age and allows you to see some of the factors that play a role in your longevity. Most importantly, the sooner you start saving for retirement, the easier it will be.

Don’t Run Out of Money in Retirement – This is the distribution phase of your retirement. The 4% rule of distribution is a good benchmark when determining how much money you can safely withdraw in retirement without running out of money. In the 1990s, William Bengen studied stock and bond market returns over a 50-year period and concluded that withdrawing 4% annually would allow retirees to live off their retirement savings for at least 30 years, regardless of market conditions. Using the example above, if you had $3.6 million in savings, multiplying it by 4% would give you $144,000 annually. To be more accurate, our financial planning software can help determine cash flow needs and also run Monte Carlo simulations on your retirement plan to predict the probability of success.

Be Mindful of Your Legacy – This is the transfer phase of your retirement and where your estate planning is important. While the same rules about retirement apply to the next generation, we wanted to offer some additional insights from our experience with multigenerational clients. We believe that when your children are ready, it is important to share your estate plans with them, not necessarily your net worth. Of particular importance, is preparing them for the responsibilities that come with their inheritance. Most children become capable over time, yet some will need the help of a trustee. Regarding how much to leave your heirs, Warren Buffett says, “You should leave your children enough so they can do anything, but not enough so they can do nothing.” It’s interesting that sometimes we need to encourage clients to spend more money. Our perspective is that you can live your legacy both in the future and now by sharing family values and taking your family on vacations, funding college for grandchildren, providing a home down payment, or involving children in family charitable planning.

Retirement Planning Needs Tax Planning – A successful retirement planning strategy needs to consider tax planning in accumulation, distribution and transfer phases of retirement. Considerations include analyzing account types to use for saving, knowing when to start taking Social Security benefits, reviewing pension options, reviewing tax brackets and which retirement accounts to draw from, managing cash flow, managing taxable assets, and projecting lifetime cash flows. During the accumulation of savings, contributing to a 401(k) or an IRA may be a good tax strategy. Also, a health savings account (HSA) may be another good savings strategy. In distribution, it is important to review liquidating taxable accounts or tax-deferred accounts such as an IRA or 401(k). Generally, you would liquidate your taxable account first, but it is important to consider cash flow needs, tax brackets, and the impact of Required Minimum Distributions that start at age 70 ½. Sometimes it may be worth doing a ROTH IRA conversion if you are in a lower tax bracket. In the transfer phase of retirement, proper estate planning can save federal and state estate tax.

Don’t Underestimate Healthcare Cost – Healthcare costs typically rise as we age. According to Fidelity Investments, the average 65-year-old couple will spend about $280,000 on healthcare over the remainder of their lives, not including long-term care. Also, once you reach age 65, you become eligible for Medicare and the amount you pay depends on several factors, including your income, additional coverages and possibly late-enrollment fees. Also, Medicare doesn’t cover everything. For example, dental, routine vision, and most long-term care is not included. It is estimated that 70% of us who reach age 65 will need long-term care (e.g., help with activities of daily living such as bathing and dressing). According to the Association of Long-term Care Planners, the average cost for a private room in a skilled nursing facility home is $8,365 per month. In states like California and New York, the average cost is over $10,000. Medicare only covers 100 days of care at a skilled nursing facility, and only if it was preceded by a hospital stay of three days or more.  Clients who are under $5 million in liquid assets and in their late 50s should consider long-term care insurance. As part of their consideration, they should also review the advantages and disadvantages of traditional long-term care vs. newer hybrid life insurance policies with long-term care riders. These are areas where we can help.

Determine the Right Social Security Strategy – If you begin taking benefits at 62, you’ll only receive 70% to 75% of your scheduled benefit per check. You will receive 100% of your benefit if you wait until your full retirement age. If you wait even longer, your Social Security benefit increases. This benefit maxes out at age 70, and you would receive 124% of your benefit if your full retirement age was 67, or 132% if it was 66. If you can afford to wait, generally age 74 is the breakeven where deferring benefits is better than taking them early.

Assess Your Life Insurance Needs – If you have an unnecessary life insurance policy, it may make sense to terminate coverage, surrender the policy for its cash value, exchange to a better policy, or even sell your policy. If you sell your policy to a life settlement company, you need to mindful of the fair market value along with any capital gains that exceed your basis. A sale of a life insurance policy when someone has a life expectancy under two years is considered a viatical settlement and is tax-free.

Review Your Estate Planning – It is important to make sure your estate plans are updated and aligned with the beneficiary designations on your investment, banking and life insurance policies. It is also helpful to have a singular document that describes who to contact, a reference to all your important financial information, who the beneficiaries are, contact information for your advisors including doctors, lawyers, accountants, and religious counselors, Internet accounts with usernames and passwords, and any other information your family may need.

Ideas to Reduce Cost in Retirement – Some retirees get creative in reducing costs in retirement. Examples include, working part-time and at a place that has perks for their favorite hobby like golf or skiing, downsizing, renting their home or extra room, selling things online, starting a business, moving to a place with a lower cost of living, traveling in the off-season, and being healthier to reduce medical expenses.

Be Prepared – Last but not least, some people are not prepared emotionally for retirement as their job is part of their self-identity. Volunteering, picking up a new hobby, traveling with your spouse, spending time with family, getting a part-time job that you’re passionate about, joining a support group, or meeting your wealth advisor, are all good strategies.


Bottom Line

Whether you’re headed for retirement or in retirement, planning is the foundation for successfully accomplishing your goals. As experienced financial planners, we can help you make the right decisions throughout the phases of wealth accumulation, distribution, and transfer. Our holistic and comprehensive approach also considers important retirement considerations such as investment management, tax planning, estate planning, real estate, risk management, wellness, and business planning. Finally, and most importantly, we continuously monitor your progress and adjust planning so you have the best opportunity to achieve long-term financial security.


As a wealth management firm, not only do we help grow and protect your wealth, but we also help with all aspects of family, wealth, business, and philanthropic legacy planning. Please reach out with any questions, comments, or if there is anything we can do to serve you better.

Cheers again to your health, wealth and wisdom. We wish you a blessed and prosperous 2019.

Warm and best regards,

Don B. Saulic, CFP® CPA

Partner, Private Wealth Management

Select Financierge Topical Index (by Publish Date)

Business Planning
Business Entity Structures and New Tax Law Considerations (Aug 20, 2018)
Five Charitable Planning Perspectives to Know Before You Sell Your Business (Aug 20, 2018)
Two Estate Planning Tips for Your Businesses (Aug 20, 2018)
Four Strategies to Preserve Your Business’ Future (Aug 20, 2018)

College Planning
Five Ideas about 529 College Savings Plans (Nov 2, 2017)

Charitable Planning
Twelve Charitable Planning Ideas to Reduce Income Taxes in 2018 (Feb 14, 2018)
Five Charitable Planning Ideas (Nov 20, 2018)

Estate Planning
Five Annual Estate Planning Tasks (Nov 2, 2017)
Four Components of a Wealth Legacy Plan (Nov 20, 2018)

Investment Planning
Dividend Stock Investing (Feb 14, 2018)

Lifestyle Planning
Six Items to Keep in Your Vault (Nov 16, 2017)
Twelve Proactive Tips to Fight Identity Theft (Nov 16, 2017)
Twelve Ideas to Guard Your Family in a Digital World (Nov 16, 2017)
Is Your Lifestyle Balanced and in SHAPE? (Nov 20, 2018)

Real Estate Planning
Four Points to Ponder Before Buying or Leasing a Home (Jun 22, 2018)
Six Considerations About Mortgages, Refinancing and Taxes (Jun 22, 2018)
Five Elements of Reverse Mortgages (Jun 22, 2018)
Four Perspectives to Consider in Deciding to Move to a State with Lower Taxes (Jun 22, 2018)

Risk Management and Insurance Planning
Starting Social Security Benefits – Ready, Set, Hold!? (Nov 2, 2017)
Nine Considerations to Maximize Social Security Benefits (Nov 2, 2017)
Lifestyles of the Affluent and Exposed (Nov 16, 2017)
Eight Benefits of Health Savings Accounts (Mar 16, 2018)
Seven Ideas for Life Insurance (Mar 16, 2018)
Six Considerations About Long-Term Care Insurance (Mar 16, 2018)

Retirement Planning
Starting Social Security Benefits – Ready, Set, Hold!? (Nov 2, 2017)
Ten Things to Know About IRAs and Saving for Retirement (Feb 14, 2018)

Tax Planning
Twenty New Tax Reform Bill Changes (Feb 14, 2018)
2018 Year-end Tax Planning Strategies (Dec 17, 2018)



The Bahnsen Group is registered with HighTower Securities, LLC, member FINRA and SIPC, and with HighTower Advisors, LLC, a registered investment advisor with the SEC. Securities are offered through HighTower Securities, LLC; advisory services are offered through HighTower Advisors, LLC.

This is not an offer to buy or sell securities. No investment process is free of risk, and there is no guarantee that the investment process or the investment opportunities referenced herein will be profitable. Past performance is not indicative of current or future performance and is not a guarantee. The investment opportunities referenced herein may not be suitable for all investors.

All data and information reference herein are from sources believed to be reliable. Any opinions, news, research, analyses, prices, or other information contained in this research is provided as general market commentary, it does not constitute investment advice. The team and HighTower shall not in any way be liable for claims, and make no expressed or implied representations or warranties as to the accuracy or completeness of the data and other information, or for statements or errors contained in or omissions from the obtained data and information referenced herein. The data and information are provided as of the date referenced. Such data and information are subject to change without notice.

Third-party links and references are provided solely to share social, cultural and educational information. Any reference in this post to any person, or organization, or activities, products, or services related to such person or organization, or any linkages from this post to the web site of another party, do not constitute or imply the endorsement, recommendation, or favoring of The Bahnsen Group or Hightower Advisors, LLC, or any of its affiliates, employees or contractors acting on their behalf. Hightower Advisors, LLC, do not guarantee the accuracy or safety of any linked site.

This document was created for informational purposes only; the opinions expressed are solely those of the team and do not represent those of HighTower Advisors, LLC, or any of its affiliates.

About the Author

Don B. Saulic

Managing Director, Partner

Don is a Partner in the team’s Private Wealth Management practice specializing in helping affluent families develop comprehensive strategies for all phases of wealth accumulation, preservation, and transfer.

He also leads our Financial Concierge Services platform of professional alliances and serves as the editor of The Financierge.

Play Video
Play Video
Play Video
Play Video
Play Video
Play Video
Play Video
Play Video