What Does Financial Freedom Mean to You?
What Does Financial Freedom Mean to You?
The road to financial freedom can sometimes be intimidating when you don’t know where to start, but you don’t have to travel it alone. You can start to make little changes and see a big difference in no time — no winning lottery ticket necessary. Whether your dream is buying your first home, sending your kids to college, starting a business of your own or enjoying your golden years watching sunsets, WellCents has the tools and resources you need to help you turn your dreams into reality. We want to help employees just like you reach a successful and financially secure retirement by helping to improve their financial health.
And the best part? The resources available to you through WellCents are completely free.
From brand-new hires to longtime
employees, WellCents can help you budget your household expenses, pay down
debt, make more informed investment decisions and plan for retirement with
exclusive online and in-person resources, including:
·
Educational workshops
·
Online resource center
·
One-on-one meetings
·
Financial goal-setting
· Customized action plans
It’s Easy to Get Started
The first step is completing a quick and easy financial assessment. You’ll answer a few short questions about your financial history to establish a starting point on your financial wellness journey. Once complete, you’ll receive a Financial Wellness Score along with a customized action plan that identifies and targets your personal needs and objectives. With this information, you’ll better understand your financial strengths and areas for improvement so you can actively begin working toward your goals. Individual answers are kept confidential — only trends among employees as a group are given to your employer to help develop educational materials.
Different Strokes for Different Folks
Independent minds
We’ll direct you to educational articles that address your financial priorities. You’ll always have the ability to contact one of our professionals if you have questions along the way. Remember, you’re not going down this road alone.
Social butterflies
Attend group educational workshops with colleagues led by a financial professional in person. The topics chosen are based on aggregated areas expressed by employees of your company or organization. Get the professional guidance you need while discovering how others like you have worked to achieve their goals.
Dynamic Duos
Schedule a one-on-one meeting with a financial professional mentor via in-person, webinar or conference call at no cost to you. They’ll work with you to create a customized action plan and help guide you as you work to improve your financial health.
Copilot for the Journey
All of these great resources are available at no cost to you. If your roadmap takes you on a new course due to major life changes, evolving financial conditions or anything else that comes your way, you’ll have the information you need at your fingertips to make more informed financial choices.
We all have dreams, and we all have
to do a lot of the same things to achieve them. But with WellCents on your
side, you’ll have the resources and support you need to deal with any bumps you
encounter on the road to your financial freedom.
Crypto Risks
Crypto Risks
The last few months have been a whirlwind for cryptocurrency. Markets have dipped several times, including the drama of mid-2022, which saw the popular cryptocurrency Bitcoin fall in value by 70% from its all-time peak in November 2021. But despite the unsteady markets of late, Bitcoin is making its way into the offerings of some 401(k) plans.
In May of 2022, Fidelity announced it would soon begin allowing participants to allocate up to 20% of their retirement savings to Bitcoin. A much smaller provider, ForUsAll, made a similar announcement in June, and more may follow suit in the months and years to come. While cryptocurrency has been a lucrative investment for some, it’s important for investors to weigh their options carefully and approach crypto with caution if their retirement plan begins offering it.
Volatile Assets Mean Higher Risk Levels
Cryptocurrency is a notoriously volatile asset. This means the values of cryptocurrencies tend to go up and down often, and by large amounts. Significant upswings and downswings in a single day have made frequent headlines. Several economists have noted that cryptocurrency doesn’t tend to behave similarly to other asset classes given similar market conditions, making it increasingly hard to predict how crypto will perform in periods of inflation or recession, for example.
Caution Is Warranted
One of the best ways
to make sure you’re making the right decision before you add cryptocurrency to
your portfolio is to do your homework. Cryptocurrency is a new asset with
different underlying mechanisms than stocks, so it’s important to understand
the technology that enables crypto and the factors that influence its value
before you invest.
A good rule of thumb is to only invest money in cryptocurrency that you’re prepared to lose. Some investors have lost nearly all of their crypto, whether due to market drops, crypto provider failures or even rare instances of hacking. In addition, cryptocurrency is decentralized, which means that no government or single financial institution backs it, even when it’s included in a highly regulated account like a 401(k). If this is money that you’re depending on, a more stable asset with a strong institutional backing may well be a better choice for you.
Let a Professional Help You
Though some
successful investors and celebrities have touted the benefits of
cryptocurrency, it’s important not to be swayed by the hype, particularly when
you’re saving for retirement. Remember, high-income investors can afford to
lose money due to volatility that everyday retirement savers might not be
prepared to lose.
Do your research, make sure you understand this asset and be prepared for high volatility. It’s also important to diversify your portfolio and choose a mixture of assets to balance it out. If you’re planning to add cryptocurrency to your retirement fund, it may be useful to talk to a financial professional first who can help you find the right amount of cryptocurrency for your portfolio — which for many might be exactly zero, depending on their personal risk tolerance.
Ease Into Retirement With a Smart Pre-game Strategy
Ease Into Retirement With a Smart Pre-game Strategy
Retirement is a major milestone — a moment to turn a new page to a chapter you’ve probably dreamed about for decades. People look forward to unencumbered schedules, freedom to travel, spending more time with relatives or moving to a dream home on the beach. Retirees often have big expectations about what a life of leisure may bring only to find out that they miss the routine and camaraderie of going to work each day. Or that moving to their favorite vacation destination means leaving all their friends behind.
It’s not uncommon for retirees to experience a surge of well-being and happiness directly after retirement, followed by a decline in life satisfaction as time passes. But you can avoid some of the stress and anxiety that retirement can bring with a smart pre-retirement strategy to help smooth out the transition.
Dip Your Toe in Retirement Waters
The day after you retire might seem like plunging into the deep end of the pool – your daily work-life routine suddenly stops cold. So, instead of jumping in, consider wading into retirement with a transitional job. Maybe your current employer will let you step down to part-time work for several months — or you can explore a new opportunity with a bridge job that keeps you in the workforce (and keeps your retirement account growing) while lightening your schedule. Your WellCents financial professional can help you figure out how much income you’ll need in order to make a gradual transition into retirement.
Retire to Something Else
Prior to your last day at work, make plans and lay the groundwork for what you’ll retire to — not just the job you’ll retire from. Join a community or volunteer organization now. Get to know them and what the possibilities are so that when you retire you’ve already found a group you like, and are ready to fully engage in — or ramp up — your participation.
Relocate With Confidence
Moving closer to children and grandchildren or relocating to a favorite vacation destination can sound like the perfect retirement plan. But it can also lead to disappointment — family may be busy with other activities or your vacation spot might be lonely without a group of friends. Invest in your new community before you make the big move. Plan longer trips to the area so that you can take part in local activities, meet people, start new friendships and have something to do outside of your family circle.
Understanding Life Insurance Basics
Understanding Life Insurance Basics
It’s not a topic anyone particularly enjoys thinking about, but life insurance can be a crucial pillar of financial protection for those who mean the most to you. It helps ensure your loved ones are better able to meet their future expenses — no matter what should happen to you.
In return for your policy premium payments, the insurer promises to pay a predetermined benefit upon your passing. Your beneficiary can use the money toward whatever financial needs they may have at that time — or in the future. Depending on the provisions of your policy, your beneficiary may receive their benefit as a single lump-sum payment, a series of installment payments or by some other means. Here are some things the payout from a life insurance policy could be applied toward:
- Paying off the mortgage on a family home.
- Sending your children or grandchildren to college.
- Supporting a favorite charitable cause.
- Paying estate taxes.
- Covering funeral expenses.
- Helping your spouse pay everyday bills.
- Providing for long term care.
- Paying off student, credit card or other debt.
- Protecting a business.
- Supplementing retirement income.
But you have a number of decisions to make before you purchase a policy. First, you’ll have to choose between the two basic types of life insurance: term life and permanent life.
Term life insurance provides protection for a predetermined period of time: That could be 10, 20 or 30 years, for example. If the loss occurs within the period you’re covered for, your designated beneficiaries receive the benefit. If not, no benefit is paid out. You might be interested in this type of policy for income replacement prior to retirement or to provide care for your children until they become financially self-sufficient.
And you also have two options when it comes to permanent insurance: whole life or universal life insurance — with either able to provide lifetime coverage. Permanent life generally costs significantly more than term life policies, but it also accumulates cash value that you may even be able to borrow against should the need arise.
Whole life insurance coverage is more predictable as the premiums, rates of return and amount of benefit are guaranteed and fixed. These policies can be useful to help provide for longer term needs such as ongoing care for an adult child. Universal life insurance, on the other hand, can offer an adjustable death benefit as well as premiums, within certain parameters. Cash value growth is dependent on the interest rate climate, so it’s important to consider that potential impact when looking at this type of coverage. Finally, look into fees, no matter what type of policy you select.
Life insurance can be an important foundation of financial protection for your family. And while it may seem complicated, it doesn’t have to be. Your financial professional can explain the options available and help you determine which type of insurance best meets your needs and budget.
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How Working from Home Could Impact Your Retirement Plan
How Working from Home Could Impact Your Retirement Plan
If you’re working from home during the pandemic, and the “new normal” becomes permanent, you should contemplate how this change could affect your retirement strategy.
First, it’s important to consider the difference between working from home (WFH) and working from anywhere (WFA). In a WFH arrangement, employers may still expect workers to come to the office from time to time. But in a WFA arrangement, employees have the flexibility to live and work from wherever they choose.
A WFA scenario offers maximum freedom and may allow a worker to relocate to another part of the country (or even outside of it altogether) to take advantage of a lower cost of living.
WFA is not nearly as common as WFH. In 2019, few companies based in the U.S. offered WFA arrangements, with about 95% of remote employees required to work from a set location. However, Household Pulse Survey data collected by the U.S. Census Bureau shows that more than 35% of U.S. households have engaged in more frequent telework than prior to the COVID-19 crisis.
Remote Work Can Be a Retirement Game-Changer
Working anywhere other than the office may reap significant cost savings for employees in a variety of areas, including:
- Cheaper housing
- Lower transportation costs
- Fewer socializing and entertaining expenses
- Reduced purchases and upkeep for work attire
- Greater ability to handle child and adult caregiving duties
Retire sooner. With a substantial drop in housing or caregiving costs, you may find that you can retire sooner than you’d hoped. Taking advantage of a lower cost of living can bend the retirement timeline significantly. You may not have to move very far for this to make a big difference, particularly if your job requires you to reside in a major city, where the cost of just about everything is often much more expensive.
Work Longer. On the other hand, WFH may give some the flexibility and desire to continue working past retirement age. For example, if an employee has health or mobility limitations, working from home may make it easier to stay in the workforce longer. Additionally, employees nearing retirement may have parents who require assistance, and having the kind of flexibility that WFH or WFA affords them may allow them to fulfill their family obligations while remaining on the job.
The pandemic has created significant hardships and burdens for many families. The possibilities for continuing remote work may constitute a bright spot in the darkness.