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Learn and Plan | When is it time to revisit a retirement plan?
early 60s asian couple reviewing their retirement plans

When is it time to revisit a retirement plan?

Monday 13 July 2020 | Reading Time: 5 minutes

When it comes to retirement, you want to be as prepared as possible. You do not want to just set and forget the money and assets you are putting toward your golden years. To help ensure everything is on track, it is a good idea to review your retirement savings plan at least once a year or whenever something significant happens in your life. If you have not looked over your plan in the last 12 months, now could be the time to review it. Here are some questions you could ask yourself as you review your plan.

Have you experienced any major life changes?

Whenever a significant event occurs in your life, it can affect your current and future finances. Getting married or divorced, having a baby, buying a house, starting a business, changing your job, losing your job, getting a big promotion, and changes in health are just some examples of major changes you may experience at any point in your life. When they do occur, it is a good idea to reassess your retirement savings needs. If your marital status has changed, for example, you may want to edit the beneficiary designations on your plan account so they reflect your current wishes. 

Have you calculated how much money you need for retirement? 

Continually evaluating how much it will cost you to live comfortably in retirement can help to make sure you are saving enough over time. Let’s face it, planning for retirement is a long process and over the years, your goals and dreams can change. If they do, it means the amount of money you need to achieve them may also change. 

Perhaps you have decided you want to travel more. Maybe you want to move to a new state or country. Whatever your new goals may be, you need to factor in how they may affect your retirement income needs. If you experience a significant life event or you have new goals, you may want to consider creating a brand new plan. 

Spend time researching costs associated with housing, travel, and other expenses related to your new goals. Once you know the costs, compare the costs for your desired retirement to your estimated income. If you have enough to cover what you would like to accomplish, that is great! If your plan is not balanced, you may need to make plans to create a bigger nest egg to realize your goals. Try using a retirement calculator to estimate the total cost and the amount you will likely need to save every month to help reach that goal. 

Do you need to make any savings adjustments?

If you have not assessed your retirement savings in a while, some of the factors mentioned above may have made your goals unaffordable. If that is the case, you could consider adjusting your retirement plan so your savings are on the right track. You may need to go over your current budget and adjust it to save more money for your retirement. You can also consider increasing your income by taking on an extra job or looking for another, which pays a higher salary. Your calculations may indicate you need additional time to save, so consider options like delaying your retirement by a few months or years to give you time to save the money you need.

Do you need to rebalance your portfolio?

Your retirement portfolio may be composed of various assets that have different rates of growth. It is a good idea to reevaluate your investments to make sure they are delivering the returns you expect or want. If they are not performing the way you would like, you could consider rebalancing your portfolio. Making these adjustments often means altering the amount of risk you are willing to take. In any long-term investment plan, you need to expect swings at times of uncertainty. The stock market can experience volatility, so you will need to consider what your risk tolerance is for fluctuations in the value of your investments while you pursue your long-term retirement goals. There are many options to consider, such as fixed index annuities.1

Should you increase your contributions?

Consider regularly increasing your 401(k) contribution. If your company matches contributions, try to take advantage of their maximum match amount. If you have come into extra money via an inheritance, a raise or bonus at work, or a sizeable tax return, consider using that money to bolster to your retirement account. If you have the means, it is in your best interest to contribute as much as you can before you retire.

Have you spoken with a financial professional?

If you would like some advice on how to better navigate your retirement income, visit a local financial professional2 who can help you to achieve your long-term financial goals. You can find a financial professional near year by completing this form.


1.Fixed index annuities are not a direct investment in the stock market. They are long term insurance products with guarantees backed by the issuing company. They provide the potential for interest to be credited based in part on the performance of specific indices, without the risk of loss of premium due to market downturns or fluctuation. Although fixed index annuities guarantee no loss of premium due to market downturns, deductions from your accumulation value for additional optional benefit riders or strategy fees associated with allocations to enhanced crediting methods could exceed interest credited to the accumulation value, which would result in loss of premium. They may not be appropriate for all clients. Interest credits to a fixed index annuity will not mirror the actual performance of the relevant index.

2. The term financial professional is not intended to imply engagement in an advisory business in which compensation is not related to sales. Financial professionals that are insurance licensed will be paid a commission on the sale of an insurance product.

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