Retirement planning is confusing to many as it is a multistep process and evolves over time. In order to make your retirement more comfortable, fun, and secure, you have to build a comfortable financial cushion that will fund you for all these needs. The major part here is to pay close attention to planning it all well.

Planning for retirement starts when a person starts to think about the retirement goals and how long it may take for oneself to meet those. Once this focus has come, you have to look at various steps involved in retirement planning and what types of retirement financial planning avenues will help you raise funds for the future. As you start saving for it, you can further invest it and get it to grow by itself.

Robert Nico Martinelli on taxes

While planning for savings and investments for retirement, one surprise part may be taxes. If you have received tax deductions over many years of money you contributed towards retirement funds, there may be a tax bill when you are trying to withdraw the savings. However, Robert Nico Martinelli also suggests ways to minimize these retirement taxes while you save funds. Further, we will discuss some steps you should take to have a solid and comfortable retirement plan.

  1. Know your retirement horizon

Checking your planned retirement age and the distance from the current age may set the base for your retirement strategy. The longer period you have for retirement, the higher your level of risk to make your retirement portfolio withstand. If you are still young in your 30s, then you may have put most of your assets in high-risk buckets like stocks. Also, you need the returns by outpacing the inflation so you will be able to maintain your purchasing power after a longer period.

  • Determine your retirement living expenses

Many people believe that their expenses may be significantly lower after retirement compared to their pre-retirement life, but this is not always true. You need to have realistic expectations and projections about your post-retirement living expenditures. You should first define the size of your retirement portfolio.

  • Calculate the after-tax returns on retirement funds

As we discussed earlier, if you have set aside tax-free investments into retirement funds, tax may be applicable when you take out this money for retirement needs. So, you need to have a realistic expectation of the funds in hand during retirement. As you age, the return threshold may decrease as low-risk portfolios may largely be composed of low-yielding securities.

  • Assess your risk tolerance in light of investment goals

A proper fund allocation and balanced investment are required when you are planning to build a retirement portfolio. Analyze how much risk you can tolerate and what income to be set aside for expenditures? You need to have a realistic return objective and risk aversions as you get older and do retirement planning.

If you get confused with all these needs, it is advisable to go for a professional fund manager to give you advice about retirement financial planning. Robert Nico Martinelli is a businessperson and fund advisor helping individuals and corporates in financial planning and fund management.