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Retirement Road Trip

Sigma Investment Counselors

January 27, 2015

Imagine yourself planning a road trip across the country.  The route has been mapped out with projected stops based your vehicle’s fuel efficiency.  The amount of time, as well as the cost, has been estimated based on the price of gasoline and your expected speed.  Unexpected events like traffic, weather, or vehicle maintenance will be part of the plan, just in case luck is not on your side.  Conservative assumptions are better to use to set expectations and provide some wiggle room.

Although the time period is significantly shorter, planning a trip like this is very similar to planning for retirement. 

The first step is determining where you want to go.  This may include multiple destinations: winter home in Florida, summer home in the Midwest, trips to see grandkids, a little consulting or volunteer work along the way.  Envisioning your time and desires during this next stage in life is of the utmost importance. 

The next step is evaluating how much fuel it will take.  This is where getting into the details of your cash flow needs and various assets and liabilities are so important.  Every situation is unique.  You may be in route and have plenty of fuel.  If this is the case, efficiency is important and you will likely be pleased to see the numbers and the new opportunities that proceed.  Or, you may have the date of the trip on your mind and seeing the numbers will make you feel at ease knowing what it will entail.  In most situations, we find that uncovering some unknowns and looking at the numbers when presenting a realistic retirement plan provides peace of mind for travelers. 

Lastly, plans change with life.  There are some things that we have no control over that can alter our trip in a major way.  Weather, traffic, and capital markets are just a few worth mentioning.  The proper planning includes reliable people, conservative assumptions, and a disciplined approach to provide the flexibility necessary to adapt in order to reach your destination.

At Sigma, we enjoy partnering with clients to create, guide, and share this journey through all conditions.

All suggestions and comments are welcomed.

Tony Basalla 

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