Beyond Benchmarks: A Smarter Approach to Retirement Planning

By Andrew J. Tapparo, MSF, RICP®

President Roosevelt said, “Comparison is the thief of joy.” While he may have been speaking in more general terms, this can be applied to all aspects of life, including retirement planning.

The one-size-fits-all approach rarely works because your plan should be as unique as you are. The financial indexes you see in our increasingly accessible online news sources don’t apply to everyone. Remember, those indexes are purely data-based and don’t have feelings and families or pay taxes like people do.

So how can we engage in retirement planning without a reliance on financial benchmarks? Here are some recommendations I have found helpful to stay focused on your personal financial situation instead of generic retirement models.

Identify Your Personal Benchmarks

Your starting point should be understanding how much you’ll need to pull from your investments/savings every month. The amount you decide on should be directly tied to the type of lifestyle you want to live during your retirement years.

Next, decide when you want to retire. That timeline determines how many years you expect to rely on an income source you create. For example, will that income come from Social Security benefits, a pension, 401(k), Roth IRA, or some other source? And in what order?

Don’t forget about family and health considerations. They should be factored into your evolving retirement plan.

All these personal decisions lay the foundation for your unique retirement income plan.

Don’t Get Distracted

It’s easy to be led astray by today’s constant influx of irrelevant information, or as I am fond of saying – “the financial media noise”. Imagine trying to research retirement financial information online without getting sucked down a rabbit hole. It’s nearly impossible, right? Instead of getting forever sidetracked, remember that the only performance you need to be concerned with is how you’re doing in reaching your own personal retirement goals and timeline. For example, there’s no point in checking your progress against an index or some random person’s portfolio results. Your investment strategy is 100% based on your past, present, and future life—no one else’s.

Something else to keep in mind is that history has shown us that all stock market declines are temporary and eventually resume their advance. This advance wipes out the decline and then carries both values and dividends to new heights. Most importantly, any permanent loss in a well-diversified equity portfolio is always caused by the investor, not the market.

Stay Focused on Your Goals

Mixed messages on social media, email scams, website popups, and news sources are just a few of the distractions that can lead you astray. Now, add in the inherently volatile nature of investment data, and you have a recipe for constant disruption, making it far too easy to lose sight of your goal.

Here are some ideas for keeping your eyes on the prize:

• Regular reviews: Be diligent about scheduling time to check your progress regularly; make necessary adjustments and stay on track.
• Automated savings: To ensure you’re consistently saving, set up automatic deductions from your paycheck to your retirement savings account.
• Vision board: Make a visual representation of your retirement goals. Put your vision board somewhere you’ll see it often.
• Remember your “why”: To help you stay focused, remind yourself of the reasons you want to retire in the first place.
• Celebrate milestones: Take time to praise yourself for reaching milestone goals, even if they’re small compared to your big-picture goal.
• Be patient: Like any goal, realizing your retirement dreams takes time. Stay persistent even when life throws you a curveball or two.

Get a Customized Financial Plan 

The bottom line is that your personal financial and retirement goals are the only benchmark you need. Don’t measure your goals or success against anyone else’s or what the internet says. Stay focused on your own path and keep looking at the big picture.

At Tapparo Capital Management, there are no cookie-cutter solutions; just personalized service tailored to meet your needs. As an independent, fee-only financial advisor, I have the freedom to provide objective, unbiased advice in my clients’ best interest.

To schedule a “Get Acquainted Call” to see if we are a good fit for each other, call 978-887-1121 or email andrew@tapparocapital.com. Let’s work together to customize a plan that’s just right for your circumstances.

About Andy

Andrew Tapparo is a fee-only financial advisor at Tapparo Capital Management, a financial planning firm in Topsfield, MA, helping clients turn their savings into a retirement income that lasts. Inspired by the quote, “Choose a job you love, and you will never work a day in your life,” Andy founded Tapparo Capital Management in 1997 with a passion for helping clients enjoy a truly worry-free and fulfilling retirement and experience financial freedom. As a Retirement Income Certified Professional (RICP®), he designs retirement strategies along with sound money management to help clients retire with confidence.

Andy holds a Bachelor of Science in Industrial Engineering from Rochester Institute of Technology in Rochester, New York, and a Master of Science in Finance from Bentley University in Waltham, Massachusetts. Specializing in retirement income planning, Andy completed a comprehensive financial industry education program at The American College of Financial Services and was awarded the Retirement Income Certified Professional® designation. He is frequently quoted in the media as a financial expert.

Andy and his wife, Susan, live in Topsfield, Massachusetts, and have two beautiful daughters. Outside of work, he is an automobile enthusiast, enjoys taking road trips, and loves the Outer Banks of North Carolina. In his spare time, he volunteers with the local high school varsity girl’s basketball team as the team statistician and runs the team’s website. He is passionate about supporting charities that serve our veterans and their families. To learn more about Andy, connect with him on LinkedIn.

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