Goals
- Retire early
- Minimize taxes
- Move to a dream destination
- Take a yearly vacation with kids & grandkids
Challenges
- 5 different pension plans + Social Security
- Large cash savings not making interest
- How to calculate if they have enough money saved
Early Retirement Case Study – Overview
Goals
With early retirement one year away, Peter and Laura needed to know the best way to maximize their retirement income given their slightly early retirement age. They wanted to ensure they had a plan that focused on tax reduction.
Upon retirement, they wanted to relocate to their home state or have a small vacation home there where they could spend their summers.
Their children lived in three different states and Peter and Laura wanted to know if they could afford an all-expenses-paid annual vacation to make memories with their grandchildren.
Challenges
Peter and Laura had five different pension plans along with both of their Social Security benefits.
They also had a large amount of cash sitting in their bank account earning very little interest, but they weren’t sure how to invest it.
Their biggest concern was how to coordinate their pension and Social Security income with their portfolio withdrawals while paying the least amount of taxes.
Most importantly, Peter and Laura wanted someone to help them put together a comprehensive plan for early retirement that addressed all of their other financial needs to ensure they are always making the best decisions.
Analysis
We began by helping Peter and Laura determine what their ideal life in early retirement would look like. It became clear early in our engagement that relocating to their home state would bring them the most joy.
We modeled out their move to their home state and how it would impact their tax situation. Then, we helped them determine what they could afford and the best financing strategy.
Knowing that the annual trip with their grandchildren was so important to them, we helped them determine an affordable budget in early retirement to make sure this happened for them.
Solutions
Peter and Laura had done a great job working and saving and had accumulated a good amount of financial resources, but still had a number of questions. We created a plan that addressed all their needs:
- A tax-efficient retirement income plan through integration of pension and Social Security strategies
- A tax reduction strategy utilizing Roth Conversions and tax-efficient portfolio management
- An investment portfolio built around their needs with the purpose of providing the income they need, even during market downturns.
- Reduced investment fees and enhanced portfolio management
- A strategy to get their cash invested and working for them
- A purchase and financing strategy for their retirement dream home
Outcome
Peter and Laura currently live in their new house in their home state and keep busy pursuing hobbies when they’re not traveling.
They look forward to the summers when they take their children and grandchildren on their annual family vacation and feel secure knowing it is accounted for in their early retirement financial plan.
They devote all of their energy towards living their best lives knowing that their financial decisions are optimized, maximizing their quality of life in retirement.
Click here to learn more about the financial planning services we offer at Satori Wealth Management.
