Once you've retired, your financial risks change substantially. Where you would have been concerned about job security before, you must now shift your attention to inflation, interest rates, the stock market, and overall economic conditions - not to mention growing government debt that threatens Medicare and Social Security. There's no doubt that it is a vastly different world than when you had a steady paycheck coming in, and that demands that you change the way you handle your finances. To maintain a healthy and durable financial position, you need to take great care in how you structure your finances so you can weather periodic storms.

While you no longer face the risk of job loss, there are a multitude of other risks that are magnified during your retirement years. The erosive effect of inflation is significant to be sure - particularly if your Social Security and/or pensions fail to keep up with the rise in the prices of goods and services. Closely related to this are fluctuations in interest rates that can have a major impact on the income you receive from interest bearing investments. Add to this a stock market that is more volatile than ever and fast rising government debt that threatens income and health benefits to retirees and you get the picture that life in retirement isn't as easy as it's supposed to be.

Fortunately, the financial services industry has come up with creative ways to deal with these and other risks during your retirement years. The question isn't really how to get a good return on your money, but how to stretch your dollars to carry you through without subjecting yourself to any undue risk. As is true with most things in life, it's all about balance and in our world, that means diversification. The central theme we use in your retirement planning is answering the question of how to receive the income and growth you need while reducing the volatility of your income and assets. To do this right, we take our time in structuring your finances so that you can go on about your life without the constant worries that plague many retirees.

Former president Teddy Roosevelt was a great contributor to the environmental conservation movement in this country, and borrowing some of his principles and applying them to personal finance can draw out an important concept for retirees - conservation is critical. While many people who are still putting together their nest egg are concerned only with saving, retirees must keep a close eye on their expenditures. While we can put together a broadly diversified income stream, you can be certain that there will be fluctuations both in your purchasing power and your expenses. As a result, conserving your income and assets is necessary to make sure your nest egg last.

An important distinction must be made here. There are expenses that are completely within your control and then there are those over which you have no control whatsoever. When we speak of conservation, we are really talking about keeping a lid on those expenses that you can control so that when those expenses that you can't control suddenly increase, you'll have some flexibility built into your budget. By taking this approach, you'll be in a much stronger financial position over the long haul.

While most of the discussion is about managing your risks, income, and assets, you must also put your affairs in order and use the law to your advantage. This comes into play in two areas - tax and estate planning. On the tax front, there are a slew of deductions available for healthcare expenses as well as new options for retirees to handle expenses not covered by Medicare. We assist our clients in understanding these issues with the goal of reducing the money typically lost through less efficient use of tax laws.

On the estate planning front, there are four key issues to contend with that include (1) distribution, (2) administration, (3) management, and (4) taxation. During the course of our work with clients, we assist them and their attorneys in structuring an estate plan that most efficiently addresses these four primary concerns. This can range from having a will and/or trust drafted and executed to re-titling assets to making the proper beneficiary designations on various assets. By using existing estate laws, we can help you minimize administrative costs, reduce estate and income taxes, and expedite the eventual disposition of your estate. While it may sound like a complicated process, it typically involves just a few hours of your time and the costs are generally very fair relative to the value that is gained through the work.

Disclosure: Cambridge nor it's affiliates offer tax or legal advice. Please see your tax or legal consultant for these services.

By the time you've retired, you've already worked with a wide range of financial services workers from bankers to brokers to insurance agents. By now, you've probably also realized that no one person has all the answers. If you'd like to get a fresh perspective on your finances, contact us using the form below and we'll be happy to sit down with you.