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If you’re five to 10 years away from retirement, you’re probably asking yourself, “Will I be financially ready when the time comes?” Answering these four questions can help you figure that out.

1. How Do I Want to Spend My Retirement?
If you haven’t already done so, now is the time to start figuring out what you want your retirement to look like. You may want to keep working part time, start a business or spend the next five years sailing around the Caribbean. Once you know where you want to go, you can put a plan in place and begin firming up the necessary finances. If you want to start your own business, for example, you’ll need to figure out how much seed money the new enterprise will require and how that will affect your retirement budget, factoring in the effects of a changed tax picture. Even a plan to kick back at home has financial implications, particularly if you have philanthropic goals or want to pass wealth along to your heirs.

2. Do I Have a Retirement Plan In Place? 
As your retirement date grows nearer, you’ll have to put a plan in place to help you translate your savings into an income stream that allows you to achieve your retirement goals. To help cover your essential expenses, hold investments that generate steady, reliable income, such as a ladder of high-quality bonds, or an annuity. Another option to consider is delaying when you claim Social Security. Someone who begins collecting at age 70 will receive monthly checks for life that are 76 percent higher than one who starts collecting at 62. To pay for discretionary spending, build a diversified portfolio that provides long-term growth, to help you keep pace with inflation.

3.  Will I Outlive My Assets?
With life expectancy increasing and health care costs skyrocketing, Americans approaching retirement are concerned about draining their nest eggs. However, according to the Merrill Lynch Affluent Insights Survey, a vast majority of affluent Americans that believe today’s uncertain economic reality is the new “normal”, also believe they’re better prepared to cope with economic uncertainty. Despite this ongoing uncertainty, more than half of all respondents (58 percent) feel a greater sense of stability in their financial lives today than they did one year ago. Concerns about the economy remain, however, with 54 percent worried about the impact of the economy on their ability to meet their financial goals, and 50 percent concerned about the lingering unemployment rate (50 percent). As for what they can control, within affluent families one-third (33 percent) of couples have felt in control of their financial lives during the last year, while half (50 percent) have taken steps to gain greater control, including more vigilantly sticking to a budget (32 percent), making more joint investment decisions (29 percent) and setting tangible goals for their future (28 percent). Similarly, 33 percent of respondents said they are living more within their means.

4. Are My Spouse/Partner and I on the Same Page?
If you’ve worked for 40 years, you may want to take time to play golf and relax at home, whereas your spouse or partner could be planning to continue working. The key is to open a dialogue early and have frank discussions about how each of you wants to spend your later years and how you plan to finance your activities. Getting together on these important decisions now will definitely make you both happier in the long run.


For more information, contact:
Michael S. Koppenhaver
Senior Financial Advisor, Senior Vice President – Wealth Management
Koppenhaver, Hawkins & Associates 
Merrill Lynch Wealth Management
55 Kings Highway
Dover, Del., 19901


Neither Merrill Lynch nor any of its affiliates or financial advisors provide legal, tax or accounting advice. You should consult your legal and/or tax advisors before making any financial decisions.  

Bank of America Merrill Lynch is a marketing name for the Retirement Services business of Bank of America Corporation (“BofA Corp.”). Trust and fiduciary services are performed by wholly owned banking affiliates of BofA Corp., including Bank of America, N.A., member FDIC. Brokerage services are performed by wholly owned brokerage affiliates of Bofa Corp., including Merrill Lynch, Pierce, Fenner & Smith Incorporated (“MLPF&S”), a registered broker-dealer and member SIPC.

Merrill Lynch makes available products and services offered by Merrill Lynch, Pierce, Fenner & Smith (MLPF&S) and other subsidiaries of Bank of America Corporation. MLPF&S is a registered broker-dealer, Member Securities Investor Protection Corporation (SIPC), and wholly owned subsidiary of Bank of America Corporation.

Investment products:

     Are Not FDIC Insured           Are Not Bank Guaranteed           May Lose Value     


Any information presented is general in nature and is not intended to provide personal investment advice. The information does not take into account the specific person who may receive it. Neither Merrill Lynch nor its Financial Advisors provide tax, accounting or legal advice. Clients should review any planned financial transaction or arrangements that may have tax, accounting or legal implications with their personal professional advisors.The Affluent Insights Survey was conducted via phone by Braun Research in October 2012 on behalf of Merrill Lynch Wealth Management. The nationally representative sample consisted of 250 business owners with revenue of $10 million to $250 million.  The margin of error is +/- 6.19 percent for a national sample reported at a 95 percent confidence level.

Annuities are long-term investments designed to help meet retirement needs. An annuity is a contractual agreement where a client makes payments to an insurance company, which, in turn, agrees to pay out an income stream or a lump sum amount at a later date. Early withdrawals may be subject to surrender charges, and taxed as ordinary income, and in addition, if taken prior to age 59 1/2 an additional 10% federal income tax may apply.

All guarantees and benefits of an insurance policy are backed by the claims-paying ability of the issuing insurance company. All annuity contract and rider guarantees, including optional benefits and any fixed subaccount crediting rates or annuity payout rates, are backed by the claims paying ability of the issuing insurance company. They are not backed by Merrill Lynch or its affiliates, nor do Merrill Lynch or its affiliates make any representations or guarantees regarding the claims-paying ability of the issuing insurance company.

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