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Ed Meek
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Edge Portfolio Management


State: IL

At Edge, a low client to advisor ratio allows for personal and customized service for each individual.  Our goal is to work as a team for each client to provide not only portfolio management but wealth coordination and financial planning.  We make every effort to have frequent communication with our clients and to provide timely response to calls and emails.  I also enjoy spending time with my wife and three kids, playing and following basketball, playing golf, and participating as an advisory board member for Breakthrough Urban Ministries.

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Retirement Ideas: When Will You Know That You Are Ready?

| BY Catherine McBreen

Welcome to our new column “Retirement Ideas”.  This column was created to help you address multiple questions that arise as you contemplate and experience retirement. While some of the information and ideas will come from the quantitative research we conduct with investors every month, much of it will come from the qualitative information we gather from investors. This information comes from focus groups and individual interviews that we conduct with investors. People are willing to share with us some of the tips that have worked for them, as well as some of the experiences that have not been so pleasant.

One of the first topics we thought we might discuss is “How will you know that it is time for retirement? When will you know if you are ready?”

There are some obvious situations that will make you realize that it is time for retirement. The first is if your company has a mandatory retirement age. The second may be if your company is offering an early retirement plan and you fall within the qualifications. Even in that situation, you will need to make a decision regarding whether the financial incentives offered are attractive enough for you to be willing to change your lifestyle.

Another unfortunate but obvious situation that will force you into retirement is a health related issue. If you or a family member is facing a catastrophic illness, you may need to retire earlier than anticipated.

But if none of the above situations is forcing you into retirement, when will you know if you are ready to retire? What types of issues should you think about?

Most of the individuals that we interview retire between the ages of 62 and 65. For most, the healthcare issue is a driver. They want to make sure they qualify for Medicare. Few individuals, however, check into the requirements of Medicare to determine if it makes a difference regarding at what age you begin to receive benefits. For most, they rely upon the advice of friends and family members. This is not always a good idea. Make sure you do your own research and be sure you understand what supplemental insurance you may need.

Eligibility for Social Security is another trigger for many individuals who choose to retire. In much of our focus group work we find that investors realize they are eligible for Social Security and wham! …they decide to retire. This may not be the best strategy. It is prudent to discuss when you should start taking Social Security with a financial advisor. Sometimes reviewing the timing between when spouses begin taking Social Security may have some long-term benefits.

Overall, the most important thing about deciding whether or not you are ready to retire should be, “have you planned for retirement?” Okay, some of us have not saved enough throughout our lifetimes to have the amount of assets that we really should have accumulated. (I would have to raise my hand.) In our research, however, we find that most people don’t even think about how they are financing their retirement until just a few months before they take the plunge. 

We will discuss some of the financial implications of retirement in the next few months, but for now, realize that one of the steps you need to take before retiring is doing the financial homework. Once you have done that you will be farther along the path to reviewing the emotional decisions regarding retirement.

Let’s assume you know how much income you will have during retirement and also have a feel for your expenses. How will you know it is the right time?

Within the research that we do, there are two specific groups. The first group has identified a particular marker for retirement. It may be a specific age or anniversary. It may be 5 years past that graduation of your last child from college. It may be the sale of your company. For those individuals, determining when retirement will start is fairly easy. The budgeting and planning can begin as soon as that landmark becomes clear.

But the second group is just the opposite. For many, it is “just a feeling”. You may find that it is getting harder for you to force yourself into the office each day. There may have been some changes in management in your company and you just don’t feel like adapting. It may be that you decide you want to spend more time with family because of an event that has happened. Or you may feel like you’re ready for a new adventure. For these individuals, retirement happens fairly quickly. They may just give a few weeks notice and all of a sudden they are in the next stage of their life.

Whether you identify more with the first group or with the second, there are a few questions you need to ask yourself. Aside from the obvious question of whether you are financially ready, other emotional issues must be considered.

  • Do you know how you plan to spend your time?
  • Is there a social network you have developed other than your associates at work? If not, do you have a plan on how to make new friendships?
  • While you may plan on traveling at the outset of your retirement, what are you going to do after the “big adventures” are over?
  • In your financial planning for retirement, have you thought about where you plan to live during retirement?
  • Is your spouse ready for you to retire? 
  • What about your family?

The decision to retire is one of the biggest decisions you will make in your lifetime. Make sure that you have thought about the implications. Don’t rush into it. Being eligible for government benefits shouldn’t be the factors causing you to make this significant life change.

About the Author

Catherine McBreen

Catherine S. McBreen is President of Millionaire Corner.  McBreen plans and develops content for Millionaire Corner.  Catherine balances editorial content to meet the informational needs of both new and seasoned investors.  She designs special monthly surveys on topical issues affecting the economic environment.

McBreen has a B.S. in speech communications from Northwestern University and a J.D. from DePail University College of Law.  She is a member of the American Bar Association, the Illinois Bar Association, and the Chicago Bar Association.

Well-known for her expertise in the affluent and retirement arenas, McBreen is a frequent speaker at industry conferences.  She has been quoted widely by the financial media, including The Financial Times, The Wall Street Journal, Research, Private Asset Management, On Wall Street, Reuters, Bloomberg News, The Dow Jones Newswires and Worth.  Cathy has appeared as a guest on CNBC Closing Bell, First Business Morning News, Neal Cavuto at Fox Business News, ABC and CBS radio.

McBreen is co-author with Spectrem President George H. Walper, Jr. of the book "Get Rich, Stay Rich, Pass It On: The Wealth-Accumulation Secrets of America's Richest Families" (Portfolio, January 2008)

Catherine is the mother of four and is involved in many school and community events.