Coasting in Retirement – Episode 82
Building a strong investment portfolio is an important part of preparing for retirement, but it’s only one piece of the puzzle.
In this episode of Coasting in Retirement, Josh Null and guest co-host Jay Stubbs discuss three personal financial risks that even the strongest portfolio may struggle to overcome without proper planning. While market volatility and inflation often dominate retirement conversations, many of the biggest threats come from events much closer to home.
Here’s a closer look at the three risks they believe every retiree and pre-retiree should evaluate.
1. Long-Term Care and Longevity
People are living longer than ever before, but longer life expectancy often brings higher healthcare costs and an increased likelihood of needing long-term care.
Josh and Jay explain that many retirees assume they can simply “self-insure” by paying for care from their investment portfolio. While that may seem reasonable, it can become extremely expensive when withdrawals must come from taxable retirement accounts.
Large healthcare expenses can force retirees to sell investments at unfavorable times or significantly reduce assets intended to support the rest of retirement.
The discussion also highlights the growing popularity of hybrid long-term care strategies, which may provide benefits for long-term care while also offering a death benefit if care is never needed. Every situation is different, but reviewing long-term care options before they’re needed can provide greater flexibility later in life.
2. Protecting Your Most Valuable Asset: Your Income
For professionals still in their working years, Josh and Jay argue that a person’s greatest financial asset isn’t their investment portfolio: it’s their ability to earn an income.
Many employees rely solely on employer-provided long-term disability insurance. While these plans provide valuable protection, they often replace only a portion of income and may include benefit caps that leave higher-income professionals underinsured.
The conversation also emphasizes the importance of understanding policy definitions, particularly whether coverage is based on an “own occupation” or “any occupation” standard. That distinction can make a significant difference for physicians, attorneys, business owners, and other professionals whose careers depend on specialized skills.
3. Tax Policy and Estate Planning
The final risk focuses on taxes and legacy planning.
Current estate and gift tax laws may not remain unchanged forever, making flexibility an important part of long-term planning. Josh and Jay discuss how unexpected tax changes or liquidity needs could force families to sell businesses, investment properties, or other valuable assets at inopportune times.
They explain that life insurance, trusts, and other planning tools may help provide liquidity when it’s needed most, preserving other assets for future generations.
Three Questions to Ask About Your Financial Plan
Rather than focusing only on investment performance, Josh and Jay encourage listeners to evaluate whether their overall financial plan can withstand life’s unexpected events.
Consider asking:
- If a health event occurred tomorrow, how long could I comfortably cover expenses before insurance benefits begin?
- Does my disability coverage truly protect my occupation and income?
- If I needed significant cash quickly, which assets would I have to sell?
Answering these questions today may help prevent difficult financial decisions in the future.
Headlines of the Week
During the show’s news segment, Josh and Jay discussed several developments affecting retirement planning.
One article examined the continued shift toward hybrid long-term care insurance, noting that many retirees are attracted to products offering guaranteed premiums and death benefits alongside long-term care protection.
Another article explored the growing movement toward fiduciary standards in the financial services industry. As more advisors adopt fee-based and client-first planning models, transparency and comprehensive financial advice continue to become increasingly important.
Finally, Jay highlighted an opportunity involving older non-qualified annuities. Under certain circumstances, existing annuities may be exchanged into long-term care-focused contracts through provisions of the Pension Protection Act, potentially creating tax advantages for qualifying long-term care expenses.
Looking Ahead: Are Retirement Dinner Seminars Becoming Obsolete?
The episode concludes with an interesting discussion about the future of traditional retirement dinner seminars.
Josh predicts that high-pressure sales presentations centered around a single financial product will continue to lose effectiveness as consumers become more informed and seek comprehensive financial planning rather than one-size-fits-all solutions.
Jay agrees that while face-to-face education still has value, today’s retirees increasingly expect transparency, personalized advice, and fiduciary guidance rather than product-focused sales pitches.
Final Thoughts
Markets will always experience periods of uncertainty, but many of retirement’s biggest financial challenges come from events that have little to do with market performance.
Long-term care costs, disability, changing tax laws, and liquidity needs can all place significant pressure on a retirement plan if they haven’t been addressed in advance.
Taking time to review these risks with a trusted financial professional can help ensure your retirement strategy is built not only to grow wealth, but also to protect it when life takes an unexpected turn.
Ready to Review Your Retirement Plan?
If you’d like to discuss your retirement strategy or evaluate whether your current plan addresses these risks, the team at Gulf Coast Financial Advisors is here to help.
Call 251-327-2124, or visit gulfcoastfa.com to schedule a meeting. Meeting options include:
- 15-minute introductory phone calls
- 30-minute Zoom meetings
- In-person meetings at offices in Fairhope, Orange Beach, or Mobile
No pressure. No obligation. Just a conversation about helping you build a retirement plan designed to weather life’s uncertainties.
This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.