Income Planning

Income Planning refers to the plans that are created around one’s income necessary to achieve a set of financial goals. This income can be accounted for from many different sources such as Social Security Income, Pension Income, Rental Property Income, Disability Income and Salary/Hourly wage income. But what happens when this income doesn’t cover the entirety of the monthly expenses needed to accomplish these goals for the investor? Furthermore, what if this income is enough today but may not be later on in the plan? This is where income planning comes into play for investors, giving them the ability to evaluate if there are any risks to the current income covering the lifetime of the investors planning and solutions on how to most efficiently close the gaps with the savings that they have or will have in the future.

Why is Income Planning so Important?

One of the most common concerns or fears for investors is not having their money last. We here at Coastal Wealth Planners hear this all too often and agree that this is something that someone with a properly prepared plan should not be kept up at night worrying about. One of the ways that we help to achieve this piece of mind for our clients is to use a financial planning process centered around a client’s goals and not just cash-flow projections. This means that we will clearly define a clients goals as Needs (non-negotiable goals such as healthcare and retirement as examples), Wants (still high priorities for our clients but not as crucial as our Needs goals) and Wishes (these would be the aspirations within their goals, but not absolutely critical to feeling accomplished). By taking such an approach we can work to ensure all of your needs are met first with a higher priority and sense of security, dedicating any guaranteed income sources towards this set of goals first and using our more variable sources to pursue the wants and wishes.

Why Rely on a Professional for Income Planning?

While Income Planning may seem straight-forward in concept, it is extremely complex in its practice over the life of a financial plan. For example, a retired couple has a high probability of one of the spouses living into their mid-80’s to early 90’s. This could mean planning for 20 or more years of inflation, unknown market returns and possible changes to the current retirement benefits and/or tax laws that currently are in place. Too often an assumption of taking your current savings divided by your annual withdrawal need today will give an answer to how long your savings could last. Unfortunately, the cost of certain expenses over a 20-year period could double to triple over that time! Not to mention, dependent on the account type taxes should be factored in as part of the full withdrawal need all the while market conditions may be providing more longevity in the life of the account or they may expedite the draw-down. Wondering what it may cost for different goods in the future? Register HERE for our free educational planning tool and take the “What will it cost?” quiz.

Having a plan in place will best evaluate how to approach solving for both today’s and tomorrow’s needs. At Coastal Wealth Planners we will also continue to evaluate if your plan is on track and/or if your plan has changed in any way over time. In addition, our planning process will properly account for the rising costs of your goals over time, potential market conditions throughout the planning period and taxation of any investment related accounts or withdrawals. Not only does our planning allow for complex calculations of these potential events but it also allows the ability to look at different scenarios as trade-offs in our collaborative planning efforts to give multiple options to our clients rather than just success or failure.

How to get started with Income Planning

The first step in beginning Income Planning is finding a trusted professional to work closely in conjunction with as a partner. Coastal Wealth Planners brings an approach that seeks to know your personal values, opinions and concerns as well as those of the people closest to you in order to deliver a truly unique planning experience tailored to you. Our process begins with an introductory phone consultation where you can connect with us and ask any questions you may have. During this conversation we will be able to give both our professional opinion as well as understand your personal opinion on if our services add value to your investment and planning needs. Should we move forward, we will request the relevant information be provided to us to begin to more deeply understand your situation. We will hold a one hour discovery meeting to review the information and/or documentation provided in preparation for our planning to ensure nothing was missed. Most importantly we will spend the time in our discovery meeting understanding who you are and why your goals are important to you. At the conclusion of the Discovery meeting we will decide if formalizing our relationship and building a plan makes sense for all involved. Should we move forward, a plan will be created and presented to you with any applicable action steps that should be taken. We here at Coastal Wealth Planners will walk you through the plan in its entirety ensuring that any questions you may have are answered and you understand our rationale for the recommendations outlined.

To schedule a complimentary Income Planning Introductory phone appointment please call us at 732-554-1099 or directly schedule HERE

Want to learn more about some of the topics discussed and how they may pertain to you? Register HERE for our complimentary educational planning tool.

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