Early retirement planning is nothing more than a simple plan. Once the dream of retiring to something else is in your mind write down things you want to do and things you never want to do again. 2 lists, the hope tos and the never agains.

Have you ever heard “plan your work, then work your plan”…that is what it takes.

Some never agains may be shoveling snow, commuting, keeping up with the neighbors, it will be different for everyone but write it down to sharpen your focus of why you are retiring early.

Early retirement planning may include your dream of travel, it may be painting or photography, you could be a missionary or social service worker…whatever you want to do, commit it to writing and look at it often, again this will sharpen your focus and keep you on track.

Put a time frame on your plan

Goals should be measured against a time frame. If you want to retire in 5 years, and you have certain steps to take, put a to be accomplished by date on each step.

For instance if you want to retire to Mexico, a worthy goal, in 2 years, learning to speak passable Spanish in 12 months would be a step with a time frame that you could measure. Without the self imposed deadlines things tend to slip and goals are missed. Our early retirement planning had a five year time frame to retire; we cheated and retired in four years. Should have done it sooner than we did.

On the other hand some steps you may think are really important turn out to be unimportant in comparison to actually retiring.

For instance, before we left for the Caribbean we wanted to be more accomplished sailors. We discovered you learn as you go and things that we were told were important before you leave weren’t that important after all. Live and learn, but commit it to writing..that is the key.

The importance of writing down your plans cannot be overstressed.

And for the fellas and the gals write down your lists by yourself and then compare them. You may be very surprised at something that is important to you is not so important to your spouse. Come up with a blended list, it is a lot easier to navigate when both oars are pulled in the same direction.

Early retirement planning…get started right now. Enjoy.

Retirement is a subject that you cannot afford to postpone for long. It is an issue that needs to be dealt with sooner, rather than left for later. Pre-retirement planning online seminars can prove to be beneficial to not only those who are nearing the age of retirement, but also in the case of those who would like to start early preparations in order to secure their future. These seminars provide all the useful information on how to create a financially stable plan that can be executed in order to yield a sustained retirement income. These cater to every individual phase of a career, irrespective of whether you are just in the initial stages or at the peak of it. In these seminars, you get an opportunity to avail of some sound advice from some of the well known professionals from different walks of life. In short, online pre-retirement planning seminars are a feasible solution to help you to financially secure your life after retirement.

Besides providing all the essential data on how to go about planning for your retirement and preparing you emotionally so that you can make a comfortable switch over, they also focus on the retirement process by teaching you the basics. They address when to retire and various other post-retirement considerations that you need to take into account, before you finally decide to retire. Online pre-retirement seminars are also an ideal source of information on numerous other topics like the 401(k) plan, the social security benefits, and other emotional and financial issues associated with retirement. These online seminars also discuss and teach you how to calculate your retirement income after you have considered a broad range of factors influencing it. These include the ever rising rate of inflation, diversification of your financial resources in different options, investing in insurance policies and retirement programs.

Undoubtedly retirement can be an exciting period in life, but at the same time it can also prove to be very challenging transition. An online pre-retirement planning seminar deals with topics like the eligibility requirements for various payment options that one can avail of after retirement, ways to accumulate your retirement income, making emotional adjustments after retirement, pension plans, learning to maintain legal transparency, planning for health care facilities, tax deferred annuity accounts and assistance with financial planning. These seminars are perfect for employees from all age groups since, they not only address the needs and requirements of employees above 50, but also those under the age of 50. They offer counseling services and are very often provided by the companies that the employees are working for.

Building a Successful Practice: It is estimated that 70-80% of investors who deal with a stockbroker, financial planner or advisor will change advisors before retirement. Some will make the change while in their fifties, others will wait until their early or mid-sixties. The reason for the change is simple: Investors view their financial person as being “growth oriented,” an accumulator who is not an expert when it comes to structuring income. When the change is made, a retirement specialist is sought.

Clients Change Advisors: Over the past couple of years, the brokerage industry has begun to promote retirement income, but the campaign has been limited and met with skepticism by investors. After all, advisory account compensation is based on assets under management–distributions only erode the advisor/broker base. The retirement benefit specialist has a very different agenda: maximizing periodic distributions at an acceptable risk level.

Investors are generally loyal to their broker or advisor, but such a relationship usually ends once the investor gets serious about retirement planning. It is not that they no longer like their advisor, they simply view this person as not having the expertise to help them with the income phase of their life. Enter the retirement plan specialist.

Retirement Specialist: The vast majority of your peers and competitors promote themselves as being able to do everything for the investor. This makes it difficult for any advisor to differentiate themselves. It is always the specialist we seek out when a problem arises (e.g., car mechanics who specialize in foreign cars, the doctor who only does a certain type of eye surgery, etc.). This is a lesson brokers, planners and advisors have still not learned. For example, how often do you see an advisor who advertises as a “retirement plan specialist” or simply a “retirement specialist?”

The specialist makes the most money and has the least complicated life. A retirement benefit specialist can hone his skills by concentrating on a very narrow aspect of the financial services industry, thereby differentiating himself and minimizing concerns.

Even though it appears the retirement specialist is “leaving money on the table,” the reality is quite different. A portion of a client’s portfolio may be in CDs, government securities and fixed-rate annuities, but another part may be in growth-oriented mutual funds that include a systematic withdrawal plan. And, just because someone is in an income mode does not mean she no longer needs insurance or no longer desires to fund a grandchild’s college fund.

Competitive Edge: During a brokerage firm’s annual meeting in a big conference hall, someone from Harley Davidson rides down the aisle in a motorcycle towards the podium. He parks the bike, steps up to the podium, looks at the audience of surprised advisors and says, “What’s your sound?” Harley’s have a special sound but how many brokers do you know have their own “sound?” No one can distinguish the sound between a Honda, Suzuki, BMW or other bike–except a Harley. This is why the company has trademarked their sound.

What makes you different? Why would someone want you to manage their money instead of a neighbor, friend or golfing buddy who does the same thing? Investment products have largely become “commoditized” and offered by everyone. Ed Slott has made a fortune by becoming the IRA-go-to-guy; he is frequently quoted in publications and is considered an expert. Ed has a lucrative practice of advising brokers, and fee-based seminars and referrals. Someone else could have filled such a position, but Ed was first and will probably not be replaced. You could become the retirement plan specialist in your county or the retirement specialist that is referred by accountants and lawyers.

Understand Your Customers and Prospects: People seek out and feel comfortable with a specialist. The first step to becoming an income specialist or retirement specialist is to obtain certification marks that distinguish you from others. Being a designee shows everyone that you have the specialized training necessary to handle their income needs.

Copyright (c) 2010 Cory Bowman

In a broad context, prudence is a virtuous principle that brings to mind careful consideration and foresight-among other things. In terms of economics or accounting, prudence is a fundamental principle that facilitates estimation in an uncertain context. It advocates that you should not overestimate your possessions or underestimate your liabilities and expenses.

As such, we can understand how prudence plays a significant role in a retirement calculation. A retirement calculation uses the premise that you can use present information for planning purposes. No one can argue that the future is certain. Since a retirement calculation requires you to determine or estimate a number of variables, it is important that you avoid creating a pretty picture by favourably overstating and understating critical variables in the calculation.

==Your salary/ salary increase ==

It is generally easy to use a fair estimate from you salary, especially if your salary or salary increases are consistent and predetermined. However, some persons have variable income and/or variable salary increases. In cases like these, it is important to be prudent. If you are in a commissioned job, you should use an average commission, since using your lowest or highest will skew your retirement calculation. For those who do not have preset salary increases, it is better to use a salary increase rate that is on par with inflation at minimum.

== The rate of inflation ==

The rate of inflation is a critical aspect of the retirement calculation as well. It determines whether you can maintain purchasing power with your retirement income. However, inflation fluctuates regularly, making it necessary to use a projected average for future inflation. According to the principle of prudence, since inflation has a negative effect, it is better to overstate it, so that you can easily adjust to worst-case scenarios.

== Your average accumulation rate ==

Many persons would love to get rates of return of 12% and 14%. Indeed, it is tempting to use such ambitious figures when performing a retirement calculation. However, a sensibly diversified retirement portfolio would do well to return those figures on average over a long period. Therefore, it is actually better to understate your accumulation rate, instead of overplaying it when plugging in your figures.

== Target percentage of pre-retirement income ==

When you retire, you should have an idea of what percentage of your retirement income you wish to receive. For example, if you have ambitious retirement plans, you might wish to retain 100% of your last income before retirement. Since many pre-retirees do not properly consider this aspect of planning, they often call an arbitrary percentage or one that is understated. Since there are many risks of retirement, it is far better to reclaim a higher percentage of your pre-retirement income (closer to 100%). Although some of your retirement expenses may be reduced, you have post-retirement inflation and health risks with which to contend.

Several other instances might require you to apply prudence when performing a retirement calculation. The important thing is to avoid presenting an unrealistically favourable estimate of your financial readiness for retirement and allow you to perceive a realistic worst-case scenario. When doing your retirement calculation, you are free to juggle certain figures, such as your average accumulation rate. You should juggle as many variables as you could to provide a worst-case estimate of your financial readiness for retirement.

Think about all the pre-retirees and retirees who did not make any provisions for the economic downturn of 2007/2008. Those who were prudent would have understood that such things can happen. Even though they were still affected, they would likely have limited their losses by managing their risk carefully. Retirees who were optimistic instead of prudent suffered substantial losses and had no idea how to recover. Establishing prudence in your retirement calculations prevents you from unpleasant surprises arising out of a harsh reality check.

You have heard a lot about pensions and the unique tax advantage that is characteristic of them. You have decided to plan for your retirement and have booked an appointment with a financial adviser you trust. There you are on the appointment day sitting in front of your adviser. It is a gorgeous summer’s day, with the brilliance of the sun’s rays stealing its way through the windowpanes of your adviser’s office. A multitude of thoughts pervade your mind, most of which you have managed to block, but one: ” I want my days of retirement to be as pleasant as this day – really easy and comfortable”. But just how can you ensure the achievement of this end? What sort of questions should be answered, with the assistance of your adviser?

Essentially the process of retirement planning should commence with your adviser establishing what pension provisions you have already, find out what your capital and income needs will be at and after retirement, and ascertain what shortfall exists between your present resources and those needed in the future when you retire. The shortfall should then be quantified in order to be able to plan successfully towards its provision.

Until the right questions are asked and answered it will be impossible to find out what the gap is between your present circumstances and where you want to be at and after retirement. So what are these important questions?

If order is important, I suppose your guess is as good as mine that the first question should be something like: ” What provision have you made so far towards your retirement?” In answering this question you should look back, more so if your current employer is not the first. You might have some ‘preserved’ pension stashed away with some previous employers, and hey don’t forget to find out how much state pension you will roughly be entitled to, during retirement.

Now that you know how much pension provision exists, the next important question to ask is ”when and how do you want to retire?”. Why is it necessary to know when you want to retire? I know women especially hate talking about their age, more so when it’s far from the teens; it is however necessary that one gets really open and honest about age at this juncture. A consideration of your age in tandem with when you want to retire will help your adviser to prioritise you needs properly. Prioritisation is important during financial planning because the resources that are available at any point in time will be limited, whereas ones financial needs may be endless! For instance, if you just in your twenties, with a spouse or civil partner and some children who are financially dependent on you, then protection through say life insurance policies will merit greater attention than savings towards retirement.

When you want to retire has to be known so that with your age in mind your adviser will know how much time you have to save up for the quantified shortfall. But just how would you like to retire? Perhaps you are employed and are considering not retiring outright, but to phase in your retirement by progressively reducing your hours of work over time. Or you might be self-employed or a director of a company and have decided to take less responsibilities over a certain period. Either way, it means that your drawing on your pension will also be phased in. This will reduce the amount of income you will require from your pension, during the early part of your retirement, and should be factored into the retirement plan.

The income and capital needs at and after retirement should also be looked at. Pension schemes pay a tax-free lump sum, currently known as ‘pension commencement lump sum’. This lump sum can be used to pay off liabilities or deal with certain capital needs at the start of your retirement, such as paying off the rest of your mortgage, buying a holiday home or indeed replacing a company car.

It must however be noted that if the tax-free lump sum is utilised at the start of retirement it will not be available to supplement later income from your pension, implying the need for higher income provision for later years after retirement. On the other hand if you have no plans to use the tax-free lump sum at the commencement of retirement, it will help to reduce the provision that has to be made for income as your retirement progresses.

We have so far being talking about your capital and income needs at and after retirement. One other main purpose of pension arrangement is to ensure that your spouse or civil partner and dependants, such as children are financially
catered for should you die.

You have to discuss what the capital and income needs of your dependants will be at and after death. Does your spouse or civil partner have a pension of his or her own? What are the ages of your children and for how long will they be needing financial support until they leave home or complete their higher education? Mind you if some of these kids are disabled they probably will need financial assistance for the rest of their lives! Do you have any special retirement plans such as a desire to enjoy a comfortable long-term care?

It is good practice to estimate your income needs after retirement in terms of a proportion of your current salary, of course making allowance for the effects of inflation. Please don’t be tempted to say you will need 100% of your current income as this will be unrealistic and also expensive to provide for.

Remember that in the early years of retirement certain expenses such as the cost of commuting to work will be absent, and mortgage payments would have been completed. On the flip side of the coin, you might want to fund some pastimes and hobbies during the early part of your retirement which may increase your income needs. Later on during retirement the cost of such activities will be reduced only to be replaced by the cost of long-term care and medical expenses. It is advisable, hence, to look at income needs earlier on in retirement in isolation from those of later years.

You will find it rewarding to bear in mind that people are living longer than they used to say, twenty years ago, and this means that annuity rates will be lower and as such more money will have to be saved to provide for the same income than would have been the case in the past. It is hence inadvisable to delay saving towards your retirement as the longer you wait, the more strain saving will have on

your income, once you start! As a result of an increase in average life span, if you opt for a final salary scheme, your employer will bear the problem of paying your pension for a longer period; a choice of a defined contribution scheme, however will place the burden of longer payments on you. If you intend leaving some of your pension fund for your dependants at death, it will influence your adviser’s choice of pension arrangement, and you must make him aware of such a desire. Finally, the various questions should be pondered separately as well as collectively as they will be interconnected. For example, your age and how much income you can save will help to answer the question whether or not the date you have set to retire is realistic.