If you’re in your 50s or 60s — 5 CRITICAL financial moves. #Finance

the other day I was meeting with a client as we were talking about ways she could optimize her retirement plan she said I wish I’d known this information 15 years ago because I would be in a much better situation today in today’s episodes I’m going to cover the top five

Financial moves that you should make today and provide you with action steps and honestly number four is one of those things that we often put off because frankly it’s uncomfortable but it might be the most important step you can take but first my name is Kevin L I’m a certified

financial planner and this channel is dedicated to helping a million people retire without worry now the first thing you need to do is you need to save money outside of your retirement accounts one of the things I often see people do as they near retirement is they begin saving more and more money

inside of the retirement accounts in fact you’re allowed to do a catch-up amount to help you put more money inside of your retirement account but the problem is as you near retirement and as you transition into retirement you need an account that is more flexible than your retirement accounts

and so you want to focus on building up your cash reserves and also building up your taxable Brokerage account now some of you if you’re in a very high tax bracket you want to put every penny you possibly can in a tax deferred account because you want that giant tax break

today now for many of you and I might go as far as to say for most of you you also want to prioritize putting money into a taxable Brokerage account and into your Savings account because the money you put into those accounts can be much more flexible ible than the

money you put into say your IRA and during your first few years of retirement you need flexibility for a number of reasons first everyone just needs an emergency of Savings account you want to have a minimum of six months reserves stashed away in a high Yield

account second you need some money to live on often you when you retire early you want to avoid claiming Social Security and pulling money from your tax deferred accounts so you can begin doing Roth conversions and other things and so you need some more flexible resources and

Savings account or a taxable Brokerage so you can pull that money out in a more tax efficient way and the third thing you need this money for is to pay for Roth conversions if you can pay for Roth conversions outside of your qualified accounts the long-term impact

and the long-term tax Savings is going to be much more significant the more money you have outside of your qualified accounts which is just a fancy way of saying your retirement accounts but the more money you have outside of your qualified accounts the easy easier it will be to

optimize your retirement plan later on I’ve never had a client say I wish I had less money invested in my taxable Brokerage account I’ve had a lot of people say I wish I had less money in my tax deferred account and so here’s your action step for this item make it

a priority as you think about retirement or as you move towards retirement make it a priority to create or boost your emergency Savings fund but also to increase your Investments in your non-retirement accounts now you’ll want to make sure you align your

Investments or your risk with your expected retirement date but that’s beyond the scope of this CashNews.co but if you remember nothing else from this section you just want to save some money outside of your qualified account so you have some flexibility in your early years

of retirement okay number two you want to strategically pay down your Debt one of the best gifts you can give yourself in retirement is a clean slate or at least as clean as it can possibly be and by tackling your Debt today you free up so much Cash

Flow and you also reduce so much stress in retirement and so if you have Debt start by focusing on high interest Debt like Credit cards knock those out first and then begin to move down the interest ladder and then think about whether you

want to pay your mortgage off I have a whole CashNews.co on that now I’m not sure if it makes sense for you to pay off your mortgage at least from a financial perspective but from a psychological perspective it is incredible to enter retirement completely Debt free so at the

very least pay down all of your Debt outside of your mortgage and from here on out avoid taking on new Debt whenever possible it will just make your retirement so much less stressful now I have a whole CashNews.co on whether you should pay off your mortgage before

you retire but in general you want to be completely Debt free besides your mortgage before you step into retirement here’s your action item if you have Debt create a plan to get that Debt paid off before you plan on retiring this will make

the transition into retirement so much smoother pay the Debt off and keep it gone and number three you want to optimize your Portfolio the closer you get to retirement the more attention you want to give to your Portfolio when you’re young

and you’re in accumulation phase you can take some major risk you can put it all in the S&P 500 or all in the NASDAQ or all in a couple hot stocks that is not investment advice I’m just saying you could take that sort of risk and even if it all blows up you have a lot of time to

recover but as you get closer to retirement you want to begin to evaluate the Portfolio you’re holding now there’s no one siiz fits-all solution and evaluating your Portfolio does not mean that you put a ton of your money into Bonds

don’t go read an article on the internet with some cookie cutter advice that says oh you’re 60 you should have a 6040 Portfolio don’t make decisions about your Portfolio based on your age but instead you need to eval valate your risk level and

your diversification heading into retirement now you don’t necessarily have to rotate into a less risky Portfolio or at least go into Bonds but you should begin to diversify your Portfolio if it’s all in large cap tech stocks then you

want to diversify the Portfolio but as you’re evaluating your Portfolio and you’re thinking about how much risk you want to hold you need to ask yourself a critical question if the market tanks and I have to delay my retirement am I okay with that if

the answer is no I’m not I need to retire right away then you need to reallocate your Assets sooner rather than later but on the other hand if you’re like if the market tanks then I’ll just work a couple extra years then you might be able to keep your foot on the

gas pedal now one of the problems I see is that 401K plans are fairly limited you don’t have near as much control over your Portfolio and you can’t optimize it as much as you would like to so you might evaluate as you get closer to retirement rolling over your 401k to a

rollover Ira to give yourself more to control or to give a financial advisor more control but don’t jump into that decision you want to think about it but it could give you more control over your Portfolio when you’re in the accumulation phase your 401k plan is great

but as you move from the accumulation phase to the de acccumulation phase you might want a few more options or a bit more control than your 401k allows so my action step for this SE is to ask yourself a question if the market tanks am I okay delaying my retirement and if not then you need to begin

to Der risk sooner rather than later now as I kind of wrap up this particular section on optimizing your Portfolio I should tell you I feel it’s a bit light on advice uh because it has to be I’m just some guy on the internet I can’t give you investment advice but

I would consider potentially hiring a financial advisor a fiduciary to help you optimize that Portfolio or if you want to do it yourself two books that I really like on investing is the little book of investing by Jack Bogle I think that’s the right name and then also the

four pillars of investing by William Bernstein both of those books are great I prefer Bernstein’s approach and book a bit more but bogle’s is great because it’s simple and it’s easy to understand and before I move on if you haven’t clicked the like button go ahead and

click like subscribe and if you don’t have a financial advisor and you’re looking for one I would be honored if You’ consider working with my firm there’s a link in the description that tells a bit more about what that looks like okay now the The Next Step number four and

this is maybe the most important step and it’s also the most uncomfortable but you need to set up an estate plan this is crucial both for your own peace of mind but also for the Peace of Mind of your family an estate plan makes sure your wishes are clear your wishes are carried out and that

your loved ones are protected you need a will you need a a limited power of attorney and you need a health care directive and also you want to check the beneficiaries on your accounts particularly your retirement accounts make sure the beneficiaries listed actually reflect your wishes I’ve

seen way too often that people either don’t update their beneficiaries or they have beneficiaries from long ago in the past either a former spouse or I’ve seen people have old girlfriends right they hadn’t updated in 30 years they have an old 401k and they still got a beneficiary

from back when they were dating someone 30 years ago and they’ve never updated so make sure you update your beneficiaries CU often that information is quite outdated and for many of you watching I would recommend that you explore a revocable living trust I don’t have time in this

CashNews.co to go fully into it but I think what I would just say is it’s not just for the rich and it gives you much more control beyond the grave but also it makes it easier for your heirs as they’re unwinding your estate and so here’s your action step make an appointment with

an estate planning attorney or use a specialized online service don’t use a generic service for example my firm uses something called wealth and they do a state document specific to each state advisers often find that some of the more generic online legal company documents are inadequate

because they don’t take into account the unique laws in each individual state so set up an appointment with an estate attorney or find a trusted online source and begin to create some of those legal documents that everyone needs to have next do the math on a Roth conversion as you know doing

a Roth conversion has the ability to save you a fortune on Taxes over the course of retirement but many people believe you should wait until retirement until you have no Income coming in or until you have reduced Income and then do a Roth

conversion but often when I’m calculating out a Roth conversion it makes sense to calculate up to the top of the 22% tax bracket or the top of the 24% tax bracket so even if you’re in your mid-50s and don’t plan on retiring for another 10 years you might want to go ahead and

consider moving some of that money from your traditional IRA your traditional 401k to your Roth sooner rather than later let me just show you a calculation I’m going to flip over to my screen we’re going to look at Phil and Claire again and I want to show you the impact of beginning a

Roth conversion sooner rather than later so here we have Phil and clar again um they have a million and a half and they are qualified accounts but this time they are 54 so they’re each 54 and and they’re trying to decide do we do a Roth conversion today and fill up to the top of the 24%

tax bracket or do we delay a few years until we retire so if Phil and CLA began doing Roth conversions to the top of the 24% tax bracket today their tax adjusted ending Portfolio be about 4.8 million more than if they didn’t do Roth conversions and they’d save about 3.3

million in Taxes but what would happen if they delayed until they retired so we’ll go back here we’ll refresh and we’ll see they save a little less in Taxes a few $1,000 Less in tax Savings but it makes a massive difference their

tax adjusted ending Portfolio so in this particular situation it seems to make sense for Phil and CLA to begin converting their traditional IRA or their 401k to a Roth while they’re still working now if you’re still working don’t run out and do a Roth conversion

tomorrow but you should do some calculations and figure out where am I going to convert to does it make sense to convert to the top of the 22% tax bracket or the top of the 24% tax bracket and then say do I actually have a little extra room and do I have some extra Income that I

could pay for those conversions with because remember one of the things that makes a conversion more powerful is if you can pay for it from outside of the qualified account so if you can use cash or earnings or Savings from outside a retirement account to pay for those conversions

it will make the long-term conversions way more impactful and then the other thing you want to think about is the tax brackets and so if you have the cash to pay for the conversions and you have some room in the tax bracket it might make sense to begin the conversions while you’re still

working and could have a significant impact over the long run so here’s your action step use some planning software or work with a financial adviser and run the numbers on a Roth conversion does it make sense even while you’re working to begin doing a Roth conversion okay so there you

have it I’ll leave it there but just quickly as a recap you want to build up your cash reserves or the your Investments in your tax account you want to pay down your Debt optimize your Portfolio set up an estate plan and you want to consider

doing a Roth conversion and if you start making progress in those five action items today sooner rather than later it’s going to create a much more solid foundation for your retirement and these steps can help you sleep easier because you’ll know you’re on a path to retiring

without worry finally if you saw me do some of the calculations on Roth conversions and you thought that looks really interesting I want to learn more about Roth conversions I have a whole CashNews.co where I go deeper into Roth conversions and I give you access to WR Capital