Wolf Retirement Navigation May 2019
RET IREMENT NAV IGAT ION
MONTHLY
4230 Pablo Professional Court Ste. 101 Jacksonville, FL 32224
4711 US Highway 17, Suite C-5 Fleming Island, FL 32003
As seen on:
May 2019
Lessons Learned What My Mother Taught Me
M other’s Day is Sunday, May 12, 2019. Go ahead and put a reminder on your calendar in case you forgot! In honor of Mother’s Day, I want to share the three most important lessons my mom taught me. What Work Ethic Looks Like My mom and dad raised my sister and me. Mom was there daily while simultaneously running day care centers and later becoming a middle school life skills teacher. All these jobs comprised of challenging tasks individually, but my mom managed to be amazing at all three! She always worked so hard, and I never saw her slack off or take a shortcut. A big part of our success at Wolf Retirement Navigation is because of my mother. It’s not easy to run your own business, but I learned from the best. Mom led by example, teaching my sister and me that when you have a strong work ethic, you can accomplish great things. How to Be Kind I watched my mom make friends with complete strangers. It didn’t matter who they were or where we were; she greeted everyone with kindness and compassion. Investment Advisory Services offered through Retirement Wealth Advisors (RWA), a Registered Investment Advisor. Wolf Retirement Navigation LLC and RWA are not affiliated. Investing involves risk, including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance. Past performance does not guarantee future results. Consult your financial
Most people aren’t used to receiving such kindness from a total stranger, and I remember how much her compassion meant to the people she met. Kindness is one thing you can never over-extend. Mom led by example, teaching my sister and me that when you have a strong work ethic, you can accomplish great things. “ In my work, it’s important that I understand my clients’ retirement goals. I need to put myself in their shoes to understand how hard they have worked and what their dreams are for the future. I couldn’t do my job proficiently had my mother not put kindness and empathy into my heart. The Value of Patience My mom is the most patient person I know. In both good times and not-so- good times, she would respond with patience first. I know my sister and I weren’t always the easiest kids when we were growing up. When things got difficult, my mom would still be patient with us while trying to understand our professional before making any investment decision. This information is designed to provide general information on the subjects covered; it is not, however, intended to provide specific legal or tax advice and cannot be used to avoid tax penalties or to promote, market, or recommend any tax plan or arrangement. Please note that Wolf Retirement Navigation LLC and its affiliates do not give legal or tax advice. You are encouraged to consult your tax advisor or attorney.
side of the story, which, oftentimes, differed from her perspective. I’d say we were wrong and stubborn most of the time, but her patience and understanding meant a lot to us and helped us to see the situation in a different light. Whenever I feel like snapping or losing my temper, I take a deep breath and remember that I am my mother’s son. She showed me the importance of patience, and I would be doing her a disservice if I didn’t practice patience in my own life. I’ll admit, it’s not always easy, but when I practice patience, I am honoring her. When I was young, I never really appreciated all these things my mom did for my sister and me. Honestly, I took them for granted. Now that I’m a parent, I recognize the time she took to teach these values to my sister and me through her words and actions. She is an awesome mother and a great person. The values she taught me are the same values I want to teach my own daughter. Happy Mother’s Day, Mom. Thank you for all the lessons you taught me and for helping me become the man I am today. I love you. -Adam Wolf, CPA, CFP ® Annuity guarantees rely on the financial strength and claims-paying ability of the issuing insurer. Any comments regarding safe and secure investments, and guaranteed income streams, refer only to fixed insurance products. They do not refer in any way to securities or investment advisory products. Fixed Insurance and Annuity product guarantees are subject to the claims‐paying ability of the issuing company and are not offered by Retirement Wealth Advisors.
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NO PLACE LIKE HOME New Strategies for Homeownership in Retirement
W hen you leave the workforce and can no longer rely on that regular paycheck, income planning becomes incredibly important. Your ability to enjoy your dream retirement depends on your income stream strategies during your retirement years. Meeting these goals frequently demands creative solutions. Often, these solutions can be found through homeownership. If you’re looking for ways to save or get a little extra money in retirement, here are five important strategies to keep in mind. Refinancing Refinancing your mortgage loan to a lower interest rate can greatly reduce your monthly debts. Depending on how low the new interest rate is, some retirees are able to save hundreds of dollars each month after refinancing. That said, refinancing your home isn’t as easy as making a quick phone call. You need to have a strong credit score and enough monthly income to afford the new mortgage payment. But first, you need to be certain that refinancing is the right option for you. Lenders tend to avoid refinancing existing mortgage loans into other 30-year fixed-rate loans for retirees. If you’re thinking about refinancing, expect at most a 15-year fixed-rate loan. With the shorter
If you plan on selling your house during retirement, refinancing might not be the best option. HELOC/HEL As you pay down your mortgage and the value of your home increases, the equity of your home increases. You can access this equity by selling your house or by borrowing against the equity of your home with a home equity line of credit (HELOC) or a home equity loan (HEL). Both a HELOC and an HEL give homeowners access to cash based on the equity of their home. However, they operate very differently. A HELOC works like a credit card, giving homeowners a line of credit for a set period of time. During this draw period, you can withdraw money whenever you need it. By paying off the principal, your credit revolves, and you can use it again. For example, imagine you have a $10,000 HELOC and you borrow $5,000 for home repairs. If you pay back $3,000 without withdrawing more, you have $8,000 in credit. An HEL is a one-time lump sum that must be paid back over a fixed term at a fixed interest rate with equal monthly payments. While less flexible than a HELOC, the interest rates for an HEL tend to be lower.
lower your monthly mortgage payments? When borrowers make a large lump-sum payment to the loan principal in exchange for lower monthly payments, this is called “recasting a mortgage.” There’s a big difference between recasting and refinancing a mortgage. Most homeowners find recasting easier, because it requires just a lump sum of money in exchange for lower monthly payments. You keep the existing loan and current interest rate but adjust the amortization. For example, if your 30-year mortgage has a principal balance of $200,000 with a 5 percent interest rate, you’ll pay approximately $1,200 a month. If you spend $50,000 to recast the loan plus a $250 recasting fee, you end up saving almost $35,000 in interest payments over the course of the loan. Additionally, your monthly payments will drop by approximately $300. Recasting can be great for reducing monthly payments, but it’s not always the best choice in the long run, especially if you have a higher interest rate. In addition, the money you use to recast your house won’t be available for other needs. Finally, many lenders offer recasting and others do not. So, it doesn’t hurt to ask. HECM (Reverse Mortgage) If you are 62 years of age or older, you may be able to meet your retirement goals by taking advantage of a federally insured home equity conversion mortgage (HECM). Also called a “reverse mortgage,” an HECM is similar to a home equity loan, as it allows retirees to convert the equity of their homes into cash. Houses and most condominiums qualify, as do many homes with existing mortgages. The difference is that the borrower can pay as much or as little as he or she determines. In fact, the borrower can even defer repayment entirely. As long as you comply with the terms of the loan, an HECM doesn’t need to be repaid until the last surviving borrower (or a qualified non-borrower spouse) passes away,borr passes away,
time period, your monthly payments will likely be higher.
Deciding between a HELOC or HEL depends on your financial needs. If you
need a large amount of money one time — for
Make sure the decrease in the interest rate will
example, to spend $10,000 for a new
be enough to save money each month and outweigh the higher payments.
roof — an HEL may be the way to go. However, if your financial needs will be extended over a period of time, you may need the line of credit a HELOC offers.
There’s also a cost to refinancing. The Federal Reserve Board estimates it costs from 3–6 percent to
Recasting Let’s say you find yourself in a situation where you have extra cash on hand. Most people start planning an extra vacation, but what if you could use that money to
refinance an outstanding loan balance. If you owe $60,000 on your mortgage, your refinance fees could be anywhere from $1,800–$3,600.
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moves, or transfers the property to a new owner. You must remain current with property taxes, homeowners’ insurance, and any Homeowners’ Association (HOA) fees, in addition to maintaining your home in good condition and repair. The amount an HECM is worth depends on a number of factors, including the appraised value for the home and the age of the borrower. An HECM is only available to homeowners who are at least 62 years of age; and the older the borrower, the more value is available to him or her. HECM proceeds are generally not considered taxable income. There are several options/strategies available with the HECM, including putting an HECM credit line in place. If left untouched, the available credit line grows and the borrowers can then draw the entire credit line or a portion thereof at some point in the future, regardless of their home’s value. Utilizing this strategy at 62 years of age allows for tax-free income to be available to assist with major life events throughout retirement, such as
unforeseen health care costs or the death of a spouse.
The HECM can be a powerful financial option, if your home qualifies, and offers tremendous value when planning income stream strategies for retirement. Fees and expenses can be significant with a HECM so be careful to review these carefully. Downsizing Many retirees choose to downsize. There are many reasons why downsizing might be an ideal strategy for retirement, such as lifestyle or health changes. The demands of medical expenses and care may also call for downsizing. Selling your home and moving to a more affordable place can help make your monthly budget more manageable. A lot of retirees are tired of all the housework and maintenance that comes with a bigger home. Downsizing to a smaller property means less time dedicated to chores and lawn care. Plus, moving to a smaller home may also save you money on mortgage
payments, property taxes, and monthly bills. According to the U.S. Department of Energy, heating and cooling accounts for 42 percent of your energy bill. If your square footage decreases, so will your energy bill. Just like planning for retirement, there are many options regarding homeownership when you are in retirement. If you’re considering any of these strategies, make sure you clearly understand the options, costs, and what value they can bring to your life by talking to highly experienced professionals knowledgeable in their fields of expertise. Please contact us for further guidance and referrals to professionals who may help.
SUDOKU
These shrimp skewers are a quick way to add some surf and turf to your cookout. Pair them with a vinaigrette salad for a side dish that complements without overwhelming the main event.
INGREDIENTS
Creole Seasoning Ingredients • 2 tablespoons paprika • 1/2 tablespoon garlic powder • 1/2 tablespoon onion powder • 1/2 tablespoon cayenne or chili powder • 1/4 tablespoon dried oregano • 1/4 tablespoon dried thyme 4. Add creole seasoning and mix well until all ingredients are covered. 5. Load up skewers with alternating pieces of shrimp, sausage, and zucchini until they’re full. 6. Grill skewers until shrimp are well- cooked (6–8 minutes).
• 1/2 pound raw shrimp, peeled and deveined • 1/2 pound cooked sausage, cut into 1-inch pieces • 2 zucchini, cut into 1/2-inch cubes • 2 tablespoons extra-virgin olive oil • Wooden skewers, soaked in water for 30 minutes 1. Heat your grill to medium-high. 2. In a bowl, combine all ingredients for creole seasoning. 3. In a large bowl, combine the shrimp, zucchini pieces, and sausage pieces, and cover them with the olive oil. DIRECTIONS
Answer on Page 4
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PRST STD US POSTAGE PAID BOISE, ID PERMIT 411
904-232-8760 www.wolfretirement.com 4230 Pablo Professional Court Ste. 101 Jacksonville, FL 32224
INSIDE
Solution to puzzle on Page 3
• Happy Mother’s Day PAGE 1
• How Retirees Find Money in Their Homes PAGE 2 & 3
• Shrimp Sausage Skewers PAGE 3
• Which Club is Right for You? PAGE 4
Clubs: Not Just for High School
Tips forYourTripBack inTime The Best Way to Stay Active in Retirement
Try Something New Don’t know where to start when looking for a group to join? Start online! Try searching “groups for retirees” and see what comes up. You might discover a travel group and start planning your trip to Asia. Or maybe you’ll have more fun mentoring young people in your professional field. Don’t be afraid to spend your retirement doing something new! There’s nothing wrong with enjoying your alone time, but don’t let your alone time turn into a lonely retirement. Joining a group can help you broaden your social circle, stay active, and maybe even learn something new about yourself.
While it’s great not having your nose to the grindstone nine-to-five, leaving work also means leaving behind a lot of daily activities and social interaction. Eventually, having nothing but free time goes from relaxing to isolating, and that can be dangerous to your physical and mental health. When planning for retirement, it’s important to plan ways to stay active and engaged. Joining a new organization or club can be a huge benefit. Here are a few suggestions to help you stay active in retirement. Enjoy Your Hobbies Did you spend years dreaming about hitting the golf course every day? While it can be nice to spend some time alone on the green, consider joining a golfers club if you want to mix things up. Enjoy
scrapbooking? Check for get-togethers at the craft shop. If you’ve always wanted to try pottery, look for a class at the rec center. It’s easy to find groups dedicated to just about any activity. Get Involved Think of the causes you’re passionate about and get involved! Animal shelters and soup kitchens are always looking for volunteer help. Book lovers of all ages can join their local Friends of Libraries chapter. To make a difference through politics, help with fundraisers or join an active campaign. If you want to stay closer to home, check out your local homeowners association. There are plenty of ways to engage with like- minded people while making a difference.
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