Throughout the course of Creating Your Encore Career, we’ve talked about various aspects of creating your Encore Career. We’ve dived deep into mindset, marketing, and connecting with your ideal client.
However, we haven’t talked much about the financial side of an Encore Career.
This is why I had James Woodall, a Certified Financial Planner and the owner of Woodall Wealth Management, on the show last week. Throughout his career, James has worked with people just considering retirement as well as with people who are still going strong at 95 years old.
James shared his journey and explained some of the insights he provides for his clients. He also helped us understand many of the financial aspects of starting a business in your later years.
Planning for Taxes
One of the biggest myths about retirement involves taxes. Most people don’t know that taxes increase in retirement. We just don't think about that.
However, it’s true. When you turn 72, your taxes actually go up.
This is why it’s so important to plan for taxes down the road either through Roth conversions, owning a rental property, or even decreasing your income.
What to Do In “Lean Times”
Many of us are worried about the recession we are now in. We wonder how we’ll survive as a retiree in lean times like this. Here is James' advice on how to prepare for lean seasons:
1. Take a deep breath.
2. Understand your material needs.
3. Build up an emergency savings account with eight months of expenses saved up.
4. Figure out how much debt you owe and make a plan to pay it off.
5. Make a budget and figure out how you’ll meet all of your expenses. Maybe you’ll need to get another job or start your own business. Do something that will get you the most value for your time.
The Big Three
There are three questions that James asks all of his clients. These questions help them figure out what to do with their retirement years and how to make the most of their time. They are as follows.
1. Image you won the lottery. What would you do differently?
2. Imagine yourself five years from now. You go to the doctor and they tell you that you have terminal cancer and have five months to live. What would you do differently? This will reveal what you would regret not doing in your lifetime.
3. What's your retirement dream? What do you want out of life?
If you can figure the answers to these questions out, you will get to the fundamentals of who you are and what your values are.
