Answer To: Financial Management Client Memo: Understand and Mitigate Risk Overview Financial management applies...
Prince answered on May 21 2022
MEMORANDUM
To: Client
From: Naomie Thamuk
Date: 21st May 2022
Subject: Understand and Mitigate Risk in Retirement Plan
When planning for retirement, there are numerous financial and risk factors to consider. Among the most important considerations are:
1. How much wealth would you need in retirement to maintain your preferred lifestyle? This covers things like your expected life expectancy, health-care expenditures, inflation, and whether or not you want to downsize or travel.
2. How is your financial status right now? This comprises your savings, assets, debt, and income, among other things.
3. What are your plans for retirement? This includes things like your preferred lifestyle, retirement age, and whether or not you would like to create a financial legacy.
4. What are the issues you should be aware of? Market Risks, price volatility, lifespan uncertainty, and sequencing of returns risk are all included.
5. What are the tax consequences of your retirement strategy? This includes things like your income's taxability, withdrawals from retirement funds, and the effect of any Social Security payments you could get.
6. What are your concerns about estate planning? This includes things like the successors, inheritance taxes, and whether or not a trust is required.
We understand how difficult and confusing retirement planning can be. Our staff can help you create a personalized retirement plan that is tailored to your specific needs and objectives.
The following are important aspects to consider while creating a retirement plan:
· Age is a key consideration when making a retirement plan since it affects how much years that you have to invest for retirement as well as how much income you'll need to maintain your current lifestyle. (Taylor & Doverspike, 2003)
· Your marital status is yet another key issue to consider because, if you're married, your partner's earnings and assets must be factored into your retirement plan as well.
· Consider the number of dependents you have Since the more kids you has, more and more money you'll must have in retirement plan to support them.
· Your health is a significant consideration because it will influence how long you live and how much money you would need in retirement to meet medical bills.
· Life expectancy seems to be a significant consideration because it influences how long the retirement funds should continue.
· Additional forms of revenue, such as social welfare and pensions, should be considered when making a retirement program since they can supplement your income and help you cover your needs.
When it comes to investing for retirement, the connection among return and risk is critical...