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Making The Most Of Retirement Savings

By Ken Little, posted Sep 9, 2016

Proper planning and receiving sound professional advice are keys to enjoying retirement.

With those pieces in place, there’s no better place to retire than the Wilmington area, according to local retirement planners Daniel Hill Owen and David Shucavage.

Shucavage clients Rik and Marci Williams, who moved to Brunswick County about four years ago from New Jersey, are among the believers.

Rik Williams said he and his wife looked at locations up and down the East Coast in search of a suitable area to retire. They chose Wilmington for a number of reasons.

While raising their children and putting them through college, Rik and Marci Williams were also thinking about their future.

“I think people really need to earnestly begin planning and investing for their retirement years well before their 50s,” Rik Williams said.

Pat Carter, who retired with her husband, Dennis, to the Waterford of the Carolinas subdivision last year, agrees.

“I would say start working with a financial adviser pretty early,” she said. “Maximize work retirement programs and contribute on a regular basis, and you’ll be fine.”

Pat Carter, who worked in the health care field, said she and her husband always vacationed on the Outer Banks or Myrtle Beach, and bought a vacation home in Leland 11 years ago. When they were ready to retire, they sold their Rockville, Maryland, house and moved to Brunswick County full time.

“We had a big home in Maryland. The market up there is fantastic where we were living,” Pat Carter said, enabling them to make the move to North Carolina with assets they can use in retirement.

‘A different perspective’

Shucavage, president of Carolina Retirement Planners in Wilmington, approaches retirement strategies from an unorthodox mindset. He holds an engineering degree from Cornell University and worked at Corning and then Ciba-Geigy in engineering and management consulting.

In 2001, Shucavage decided it would be more meaningful to help individuals and families rather than make money for companies and changed his focus to retirement planning.  

“I come at it from a different perspective,” Shucavage said.

He said he believes that a plan for living comfortably into the golden years must be in place.

“Much of the wealth in this country is trapped in 401(k) retirement plans,” he said. 

Housing locally remains affordable compared to some of the states retirees come from. Many of his clients are in the “middle- to high-middle class” bracket, he said.

In advising others, Shucavage emphasizes five areas: income, investment, taxes, health and wills and trusts.

“You’ve got to look at how to optimize assets,” he said. That includes deciding how and when to begin receiving Social Security, along with maximizing pensions and other assets.

Investment-wise, many baby boomers at or near retirement age rely on 401(k)s and job pensions and take a “’70s and ’80s” approach to investing,” he said.

“They keep the money in there, and the market goes up and down,” he said. “When you retire, you’re taking $500 out every month, and if the market falls you have to take twice as much. You need to change your investment strategy so it will not be subject to market turmoil.” 

Taxes relating to 401(k) plans, IRAs and Social Security also must be a consideration in retirement.

“You should have a strategy to minimize taxes,” said Shucavage, who teaches classes in retirement at Brunswick Community College and University of North Carolina Wilmington.

The lessons of 2008, when many saw lifetime savings and retirement funds decimated, are another reason to have a retirement plan to protect individuals and their loved ones, he said.

‘Always be planning’

Owen is a financial adviser with Northwestern Mutual-Wilmington. Many of his clients seek advice about retirement planning.

“My perspective is that we should always be planning for our retirement,” Owen said.

According to Northwestern Mutual’s 2016 Planning and Progress Study, two-thirds of Americans believe there is some chance they will outlive their savings. More than 1 in 3, 34 percent, say that likelihood is 51 percent or better.

Meanwhile, the study suggests that relatively few Americans are proactively addressing the financial implications of living longer. Only 21 percent say they have increased their savings, while 44 percent report having taken no steps at all.

Owen recommends having a cash reserve, especially at times when the market is down.

The goal is to come up with “an overarching plan to last a 30- to 40-year retirement,” he said.

Navigating the health care marketplace and considering the “long-term care risk” can also be challenging, in addition to estate planning.

“I want to make sure I don’t run out of money but want to make sure I have grandchildren I can take care of,” Owen said.

Each individual situation, he said, calls “for a different formula and a different plan.”

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