Strategies for Building a Solid Retirement Portfolio

July 17, 2024
nest egg retirement basket isolated on black

Building wealth takes decades. The good news is that – because the process takes a long time – investors and savers have space to recover from any mistakes they made or poor market performance. The bad news is that poor habits when repeated over years or decades, can result in significantly less money for retirement if they’re not corrected promptly. 

In this blog, we’ll discuss how three strategies – tax implications, estate considerations, and overall wealth management, can make an enormous difference in building a solid retirement portfolio. 

Tax implications. Tax law is a complex and fast-changing landscape, which makes it difficult for ordinary investors to keep up with the latest rules and regulations. In general, investors’ strategies should be to minimize capital gains taxes, be certain that previous tax returns were filed correctly (and that the investor isn’t owed money due to errors), and increase the tax efficiency of the estate plan by choosing products that will minimize the tax burden both now and in the future. The right solution will depend on the investor’s assets, goals, and post-retirement plans. 

Smart investors do not attempt to “DIY” the tax complexities when it comes to building a portfolio for retirement. Professional financial advisors can help you protect your wealth and minimize your tax burden.

Estate considerations. Saving throughout one’s working life has two goals: to provide enough money to live on for retirement, and to pass as many assets as possible onto family, friends, or charitable organizations. The time spent during retirement planning is also a good time to investigate estate considerations. 

While the importance of a will cannot be overstated, it’s also worth looking at some more sophisticated plans for passing assets to heirs, perhaps in the form of a trust. A trust provides investors with more control, allowing them to designate a trustee who will perform the complex administrative work, provides more privacy than a standard will, and can significantly lower the estate taxes that heirs will owe. Many types of trusts may be appropriate for investors, and a professional financial services advisor can walk clients through all the different types to determine if one is appropriate. 

Wealth management. Good retirement planning begins with wealth management, a process that may change as investors enter different phases of life. (In other words, if you last addressed your wealth management 15 years ago, it may be time to do it again.) A professional financial services firm will work closely with investors to determine their financial goals and help them develop a realistic roadmap to reach those goals. Financial advisors can help investors balance their portfolios, create a more effective investment plan for retirement savings, address changing life circumstances, and save more money. 

Arizona-based Prime Wealth Advisors is a full-service tax, retirement planning, estate, and wealth management firm that can craft a robust wealth protection plan that will cover you, your business, and your heirs. Call 623.77.PRIME or visit our website for more information.

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