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From Here To There: A Clear View of Retirement For Women - Webinar by Gemma Jablonski
From Here To There: A Clear View of Retirement For Women - Webinar by Gemma Jablonski
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Introductions
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Question one: What unique
considerations do women have?
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What unique considerations do women have?
Let’s start talking.
Most Wealthy People Don’t Talk About Money or Plan Ahead, Investment News, July 2005; The Number, Lee Eisenberg, 2006; The Female Brain, Louann
Brizendine, M.D., 2006; U.S. Adults: Word of Mouth Communications, Lucid Marketing, 2006 5
What unique considerations do women have?
Let’s start talking.
Health, United States, 2008, Centers for Disease Control and Prevention, 2Elder Issues, Women and Aging, 3/2008
1
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What unique considerations do women have?
The sandwich generation.
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What unique considerations do women have?
Women are skilled at finances.
1Retirement Fitness Research, Richard Day Research, December 2006; 2Women and Finance, Mintel, 2005; 351% of Women Are Now Living Without a
Spouse, New York Times, 1-16-2007; 4www.cfwbr.org/facts, Top Facts About Women-Owned Businesses, 2007. 10
Question two: What do I need to
know?
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What do I need to know?
Know your financial temperament.1
ARTISANS
Entrepreneurial and look for
new ways to make money
Act quickly on investments GUARDIANS
IDEALISTS RATIONALS
1Meir Statman, Ph.D., and Vincent Wood, CFA. “Behavioral Aspects of the Design and Marketing of Financial Products.” The Journal of Investment
Consulting. Summer 2004, Volume 7, Number 1 12
What do I need to know?
Know your financial temperament.1
1Meir Statman, Ph.D., and Vincent Wood, CFA. “Behavioral Aspects of the Design and Marketing of Financial Products.” The Journal of Investment
Consulting. Summer 2004, Volume 7, Number 1 13
What do I need to know?
New retirement realities.
21%
2%
17%
Earnings
Other
OASDI (Social Security)
Pensions and Annuities
Assets
1
2008, National Coalition on Health Care
2
EBRI, Issue Brief No. 317, May, 2008
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What do I need to know?
New retirement realities.
Inflation:
1999 2009
1st class postage stamp $.33 $.44
Movie ticket $5.08 $7.20
Gallon of gasoline $.95 $1.92
Loaf of bread $.88 $1.40
Dozen eggs $1.08 $3.31
Orange juice $1.78 $2.61
Boxofficemojo.com, 2009
Feb 1999 and Feb 2009 - Bureau of Labor Statistics.com
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What do I need to know?
New retirement realities.
Are You Sure You’re Saving Enough For Retirement, National Bureau of Economic Research, Jonathan Skinner, March 2007
1
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What do I need to know?
Know your sources of retirement income.
IRA Considerations
• Traditional IRA contributions may Types of IRAs:
IMPORTANT: 1
be tax-deductible. Traditional, Roth
Beginning in 2010,
• Roth IRA offers tax-free the income restriction onor Rollover
converting
withdrawals. 1 to a Roth IRA is being lifted and
Spousal
anyone can take advantage of its unique
• $5,000 contribution in 2009; Stretch
benefits. This conversion may include
$1,000 catch-up
converting all contribution
or a portion for
of these retirement
Simplified Employee
ages 50+.
accounts into a Roth IRA: Traditional IRA, Pension (SEP)
Employer-sponsored
• Penalty-free withdrawalsretirement
for first- plan, 403(b),
timeand/or
homeapurchase
governmental
and 457(b).
educational expenses.
• Consolidating IRAs offers better
control, convenience and ability to
add more beneficiaries.
1
Traditional IRA withdrawals are taxed as ordinary income. Qualified Roth IRA distributions are not subject to state and local taxation in most states. Qualified
Roth IRA distributions are also federally tax-free provided a Roth account has been open for at least five years and the owner has reached age 59 ½ or met
other requirements. Both may be subject to a 10% Federal tax penalty if withdrawals are taken prior to age 59 ½.
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What do I need to know?
Retirement account options.
Employee-sponsored plans
• Contribute as much as you can.
• Matching is “free money.”
• Catch-up contributions are available.
• Avoid cashing out.
• Rollover your 401(k)
Taking a lump sum on a $50,000 401(k):
- $15,000 (taxes)
– $5,000 (penalty)
= $30,000.
Withdrawals are subject to ordinary income tax and may be subject to a Federal 10% penalty if taken prior to age 59 ½. Wells Fargo Advisors does not provide
tax or legal advice. Be sure to consult with your own tax and legal advisors before taking any action that may have tax or legal consequences.
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What do I need to know?
Retirement account options.
Variable annuities are long-term investments suitable for retirement funding and are subject to market fluctuations and investment risk. 1Guarantees are
subject to the claims-paying ability of the issuer. 2Wells Fargo Advisors is not a tax or legal advisor. Be sure to consult with your own tax and legal advisors
before taking any action that may have tax or legal consequences
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What do I need to know?
Make time work for you.
Investor A Investor B
Annual Yield 8% 8%
For illustrative purposes only. Does not reflect the performance of any specific investment and ignores the impact of taxes. Monthly investment of $1,800 occurs
at the beginning of each month and assumes an 8% average annual yield.
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What do I need to know?
Key considerations.
50s
the benefits of professional money management.
• Try to work on increasing your savings rate to 20% or more.
• Take advantage of IRA catch-up contributions.
• Look into long-term care insurance.
• Ensure your beneficiaries are updated on all accounts.
Insurance products are offered through non-bank insurance agency affiliates of Wells Fargo & Company and are underwritten by unaffiliated insurance
companies. Wells Fargo Advisors, LLC, is a separate non-bank affiliate of Wells Fargo & Company.
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What do I need to know?
Key considerations.
• Refresh your retirement plan.
• Plan a withdrawal strategy to help make your income last.
• Consider steps to help protect your future income-producing assets.
60s •
•
Ensure your beneficiaries are updated on all accounts.
Consider a Stretch IRA strategy to potentially extend tax-deferred growth
to your heirs.1
• Review your will and make any necessary updates.
• Review business agreements and transfer plans if you own a small
business.
• Review your income plan regularly to help ensure it is meeting your
financial needs during retirement.
• Invest time in activities that are important to you such as travel, family
or volunteering.
70s • Supplement Medicare with insurance to ensure you have the coverage
level you need.
• Consider gifting strategies for your heirs or charitable organizations that
interest you.
• Seek advice on business transfer planning if you are still running a
business and keep your will updated.
1
Stretch IRA Strategies are designed for investors who will not need the money in the account for their own retirement. There is no guarantee there will be assets
remaining in the account at the time of the IRA owner’s death. Wells Fargo Advisors does not provide tax or legal advice. Be sure to consult with your own tax
and legal advisors before taking any action that may have tax or legal consequences.
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Question three: How can I
prepare?
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How can I prepare?
The importance of asset allocation.
Asset Allocation is the way your money is divided among your investments,
e.g., stocks, bonds and money-market instruments. A study of large pension
funds showed this single factor accounted for 91.5 percent of the eventual
outcome of an investment program.*
By comparison, investment selection and market timing accounted for just 4.6
and 2.2 percent, respectively.
*Source: Brinson, Singer and Beebower, “Determinants of Portfolio Performance,” Financial Analysts Journal, May/June 1991. Asset allocation/investment timing
cannot eliminate the risk of fluctuating prices and uncertain returns.
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How can I prepare?
?
Find out what is important to you.
Traveling?
Living in a foreign country?
Moving closer to family?
Buying a bigger house?
Buying a smaller house?
Owning two smaller houses?
Retiring at 55? 60? 75?
Starting a new career?
Creating a new business?
Quitting work tomorrow?
Paying for my child’s education?
Paying for my grandchild’s education?
Going back to school?
Giving more to charity?
Having a building named after me?
Driving my dream car?
Doing more for my parents?
Helping my child buy his/her first home?
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How can I prepare?
Envision your dreams and your goals.
Your Goals
and Priorities
Confidence
Your Assets Score Statistical
and Income Modeling
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How can I prepare?
Envision your dreams and your goals.
Retirement
Retirement Age
Income
Education Goals
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How can I prepare?
Envision your dreams and your goals.
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How can I prepare?
Envision example: The Bennetts
Pam Joe
Age 54 Age 60
Advertising Sales EMT Supervisor
Makes $90k / year Makes $60k / year
What ifs
• Retirement – when and how
much?
• Mountain cabin
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How can I prepare?
Envision example: The Bennetts
Retirement Accounts
401(k)s $400,000 $250,000
Projected Pensions
and Social Security $62,761
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How can I prepare?
Envision example: The Bennetts
Portfolio (% Stocks) 60 80 90
Confidence Score
57 82 96
The following information is hypothetical and is provided for informational purposes only. The solutions discussed may not be suitable for your personal
situation, even if it is similar to the example presented. Investors should make their own decisions based on their specific investment objectives and financial
circumstances. It should not be assumed that the recommendations made in this situation achieved any of the goals mentioned.
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How can I prepare?
Envision example: The Bennetts
Buy a Log Cabin
Initial Buy Mountain and Work 2
Recommendation Cabin Years Longer
Portfolio (% Stocks) 80 80 80
Confidence Score
67 81 82
The following information is hypothetical and is provided for informational purposes only. The solutions discussed may not be suitable for your personal
situation, even if it is similar to the example presented. Investors should make their own decisions based on their specific investment objectives and financial
circumstances. It should not be assumed that the recommendations made in this situation achieved any of the goals mentioned.
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How can I prepare?
Ongoing review.
$1,000,000
$900,000
90
Investments
$800,000
$700,000 75
$600,000
$500,000
Toda
$400,000 y
54 55 56 57 58 59 60
Age
The Target Zone may help you evaluate your Recommended Plan. It does not represent a projection of future portfolio values. The target zone graph is shown in
actual dollars, Envision uses Monte Carlo simulations, which are based on historical and hypothetical information; there is no guarantee that actual future
investments will perform in accordance with the simulated trials.
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How can I prepare?
Important information.
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How can I prepare?
What to expect from your Financial Advisor.
Written plan clearly reflecting your goals and vision for the
future.
Regular updates on progress toward meeting established
goals.
Formal meetings with advisor at least twice each year.
Check-ins with advisor every 30-60 days.
Timely advisor follow up that meets your needs.
Financial advisor who listens to your needs and objectives and
creates a customized plan around them.
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How can I prepare?
Learn, engage and grow.
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Any questions?
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Thank you
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Insured Guarantee value
Wells Fargo Advisors, LLC, Member SIPC, is a registered broker-dealer
and a separate non-bank affiliate of Wells Fargo & Company. Insurance
products are offered through our affiliated nonbank insurance agencies.
Wachovia is a Wells Fargo Company.