6 key financial planning priorities

Financial planning

Each of us has unique financial goals, challenges and concerns which we address by planning. Our circumstances and needs, however, aren’t static. They change and evolve over the years. And this means we need to periodically review and adjust—making changes to our retirement income and wealth transfer plans.

The following are a few of the top priorities facing many of our clients today, along with some tips for how you and your Truist Wealth advisor can keep your overall financial plan on track:

1. Focus on retirement

According to the Employee Benefit Research Institute, there’s a 1 in 3 chance that at least one member of a married couple will live to age 95 or older.Disclosure 1 That means you realistically need to plan for a 30+ year retirement. Try to take advantage of every opportunity to put as much as possible away in your tax-deferred 401k and IRA accounts.

Tip: Take advantage of extra catch-up contribution allowances if you’re age 50 or older.

As retirement gets closer, it’s important to consider how you’ll convert your assets into a regular retirement income stream. The first step is determining goals for your post-retirement lifestyle—whether those are volunteering, traveling or working part-time. You’ll also want to make contingency plans for unforeseen events (such as a healthcare emergency or investment loss). You and your advisor can then determine a sustainable spending level that will support your retirement goals without worrying about running out of money.

2. Review your investments

Your risk tolerance will naturally change as your financial, professional and family situation evolves. As the complexity of your wealth increases during your working years, the complexity and diversity of your investments will likely follow suit. Then, as retirement nears, you’ll probably want to begin reducing investment risk on assets that are earmarked for income generation. Other assets that you’ve set aside for gifting/inheritance, however, can assume more risk.

Tip: Make sure to schedule regular check-ins with your advisor to discuss your overall portfolio diversification and alternative investment strategies that may better align with your goals.

3. Protect what you’ve built

Investing is as much defense as offence. You need to prepare for a wide range of possible scenarios. Unexpected situations such as injury, illness or a need for long-term care happen. And if you’re not ready, these events can dramatically impact your ability to achieve your goals. Sit down with your advisor to make sure you’ve got the right insurance policies with the right coverages in place. 

Tip: Business owners face an additional set of risks. If you own a family business (or other large asset), your advisor can help you explore strategies to better protect those assets.

4. Save for a child’s education

The average annual cost of tuition, fees and other expenses for the 2020 school year was $10,560 for in-state public colleges and $37,650 for private institutions.Disclosure 2 That’s a respective four-year bill of $42,240 and $150,600, without accounting for inflation or other expenses. It’s a major expense that needs thoughtful planning—not only to save enough, but also to make sure you don’t forgo saving for other important goals like retirement. Your advisor can help you evaluate various savings options like 529 plans and create a strategy to prioritize your savings.

5. Manage cash flow and debt

Liquidity is always important—whether to fund a major purchase or have cash available for an unexpected expense. As a Truist Wealth client, you have access to a wide range of banking solutions to address both short-term needs and long-term goals. Working together, you and your advisor can find the right mix of cash management and lending solutions to meet you liquidity needs, fund large purchases, and better position you for the future.

6. Plan the transition of assets

How can you be sure your assets will be distributed according to your wishes? Are there ways to avoid having assets go through probate? Can you adequately provide for your beneficiaries while also supporting causes that are important to you? A thoughtful crafted estate plan can address all of these questions, and many more.

Your Truist Wealth advisor, together with your legal and tax attorneys, can work together to structure a plan that meets your inheritance and charitable goals—no matter how complex your estate.

Interested in learning more about any of these planning priorities? 

Talk to your Truist Wealth advisor.