How Financial Plans Help Get Your Retirement Savings on Track

The pandemic. Inflation. Talk of a recession. Economic volatility seems to be the new normal, and for many, it’s making retirement planning a challenge. In fact, just 40% of non-retirees reported in 2021 that their retirement savings are on track, according to a study from The Federal Reserve. This was especially true for younger adults, who were less likely to have retirement savings altogether and more likely to feel behind on their savings plan.

There’s no doubt that the recent economic uncertainty impacted many people’s retirement strategies and plans. This is where a financial plan and a financial planner can make all the difference. The economy will continue to have ups and downs. However, a financial plan that incorporates your retirement goals can help you better manage your savings and reduce your future risk. 

What is a financial plan?  

A financial plan is a holistic view of your financial situation including goals, and guidance for how to achieve them. For instance, financial plans consider when you plan to retire and how much savings you’ll need to sustain your lifestyle.  

Financial advisors often provide financial planning services that are instrumental in helping you design such a plan. They can help forecast how your savings will grow once invested, take into account the tax  efficiency provided by different types of retirement accounts, and balance your long-term financial goals with your shorter-term needs. They can also help develop different types of strategies that address various aspects of your financial life: 

  • Estate planning
  • Investment management
  • Tax planning 
  • Business planning  

You can access financial planning through a financial advisor at an investment advisory firm, your bank, online wealth management apps, or even robo-advisors to help you optimize your current savings and leverage the resources provided by your bank and other financial institutions to help you meet your goals. 

The time for financial advice is now  

You can handle many financial tasks yourself, from making a budget to creating an emergency fund to setting up savings and retirement accounts. However, a financial planner or financial advisor can advise how all the aspects of your financial life work together to accelerate the progress toward your goals. And they can also help you understand your risk during times of economic uncertainty or personal financial emergencies

So when should you connect with a financial planner? When it comes to retirement planning, the earlier you can begin saving, the more you’ll benefit from compounding interest that increases your savings. Reach out to a financial planner to help you organize your finances and start on your retirement saving journey. 

Expert advice can reduce the sense of being overwhelmed that many feel when planning for such financial events so far in the future. And having a plan can give you the confidence you need to start and keep saving for the long term and make smarter decisions about how you handle your money today. 

What to expect  

A financial planner may want to meet in person or on video, discuss your financial needs, long-term goals, and develop a comprehensive plan for achieving them. Many financial advisors also provide financial planning services.

Though the processes may vary, in general, you would do the following:  

  • Provide information about your income, expenses, assets, and liabilities. This information will help a financial planner create a plan that is customized to your lifestyle and has a higher chance of success. 
  • Discuss your retirement timeline. A planner will want to know when you plan to retire and your expectations for your retirement expenses. Of course, these may change, but the information provides a starting point. 
  • Incorporate other financial goals. Retirement is a major financial goal for many savers, but it’s not the only one. You may also be saving for the down payment on a house, planning for your children’s college education, or paying down debt. Your financial planner will want to know about your other financial goals. 
  • Schedule quarterly or annual reviews. Financial planners know that your life changes. Checking in with the plan annually—or more often—allows your planner to make changes as your career, family life, and goals evolve.  

Planning to minimize risk

A solid financial plan allows you to be more proactive about your savings. But just as important, it also helps minimize your risk during periods of economic volatility. That’s because a financial plan designs your portfolio with your time horizon and personal risk tolerance in mind.

In the interim, depending on the type of planner you’re working with, you may also take measures to mitigate the impact of economic downturns or inflation on your investment portfolio. For example, your planner might recommend moving some of your assets into sectors that are traditionally considered recession-proof, such as utilities or energy.  

The crisis of the past few years has unsettled many savers. But postponing your retirement saving means you’ll likely need to save extra over the course of your life to meet your retirement goals. A dedicated banker and financial advisor can provide you with a personalized savings plan to reduce any stress and help get your savings on track for retirement.

This article is for promotional purposes only. Santander Bank, N.A. (“Santander”) does not provide investment, business, financial, accounting, tax, or legal advice, and the content of this article does not constitute investment, business, financial, accounting, tax, or legal advice. Santander does not make any claims, promises, or guarantees about the accuracy, completeness, currency, or adequacy of any content. Santander expressly disclaims all express and implied warranties of accuracy, completeness, currency, or adequacy of the information and content in this article. Readers should consult their own attorneys or tax or other advisors regarding the applicability of any referenced information or financial or other strategies to their own unique circumstances. This article does not necessarily reflect the views or endorsement of Santander.

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