***My Retirement Investment Portfolio: When Is Enough Enough?

Question: I’m a 57 year old clinical physician thinking about slowing down in the next few years. I don’t feel I have enough money to retire but maybe I do? How do you analyze a client’s finances to make this determination? Any thoughts you could provide would be greatly appreciated. Lia, MAnnAnswer: In essence Lia, you want to know when enough is enough. It’s a tough question to answer because everyone’s “enough” is different. As an advisor, I like to perform what I refer to as a S.W.O.T. analysis for my pre-retired clients. The acronym S.W.O.T. stands for Strengths, Weaknesses, Opportunities and Threats. Here’s an example.nn STRENGTHSn1. No debt except mortgagen2. Drive and willingness to continue workingn3. All portfolio expenses under 1%n4. Pension with cost of living adjustmentnnWEAKNESSESn1. No Long-Term care insurancen2. Interest only mortgagen3. Not enough in Emergency Fundn4. Under $250,000 in investmentsnnOPPORTUNITIESn1. Group LTC insurance available at discount through employern2. Can decrease portfolio risk and potentially enhance return by making allocation adjustmentn3. Can carry-forward realized losses on tax return in perpetuity until used upn4. Use small inheritance as seed money to fund home-based businessnnTHREATSn1. Time/expense of caring for elderly parentn2. Potential layoffs at workn3. Loss of own healthn4. Age discriminationnnLia, once I have the S.W.O.T analysis done it’s time for a chat to talk about potential options and considering what solutions will help you achieve your goals. In this case, the woman and I agreed for her to work longer, save more, adjust her portfolio allocation, consider LTC insurance, get her estate plan updated, refi her mortgage, consider starting her own business, etc. It can be hard to be objective if you choose to do this S.W.O.T analysis yourself but it has been done before. As an alternative, consider seeking out a fee-only financial advisor who will work with you on an hourly or flat-fee basis (no product salesman please) to give you a second opinion and help you arrive at your retirement destination.nnBill’s Bottom-line: Learn when enough is enough by working with a fee-only advisor. Find one at www.CFP.net or www.GarrettPlanningNetwork.com.n