Topeka financial advisers share retirement investment, planning ideas

Legal paperwork, 401(k) decisions need to be made

Brian Jacques, an attorney with the Sloan Law Firm since 2002, focuses on estate planning, tax planning, asset protection, probate, business and commercial law. Here are some of his thoughts on retirement planning and living in a retirement community.



How should I select a retirement community?

I advise my older estate-planning clients to consider visiting multiple facilities, so that they have an idea of what options are out there. Accommodations can vary dramatically from place to place. When the need arises, there is often limited time to search for a retirement facility. It’s best to have an idea of what place best suits your lifestyle before a need arises.


What legal paperwork should be completed?

Many places require a health care and/or financial power of attorney before moving into adult care facilities. It is important to have a contact person who can make decisions on behalf of the resident in the event the resident is unable to do so. A living will deals with end-of-life decisions. Giving direction to your health care power of attorney can provide assurance that your wishes are being carried out.

Having a will or a trust is important to direct the distribution of assets after your death.


Is it possible to hire a fiduciary to manage my money and pay all my bills while I live in a nursing home?

Yes. Selecting a fiduciary to be power of attorney or trustee to manage your assets is an important decision. Often, we see family members manage their loved one’s financial assets. Sometimes having a third party professionally manage those assets may be a good option.

Consider hiring a local bank, independent trust company, brokerage firm or financial planner with institutional trust offices that can manage assets on behalf of clients. The fee for this service is typically 1 percent of assets under management, but may be more or less depending on the size of the account and the type of assets owned by the client.


How do I get Medicaid to pay for my long-term care?

Typically, an individual will have to exhaust much of his or her own resources in order to qualify for Medicaid. Married couples may be able to retain more assets for the noninstitutionalized spouse.

The application process is fairly complicated, but legal counsel can assist you. Adult care facilities that accept Medicaid have social workers who can assist you in getting qualified. Many facilities require a certain period of time to be “private pay” in order to be admitted into a facility.


Ryan Gigous, a Topeka financial planner with Cordell Wealth Management, has about a decade of experience working in money management and financial planning. Here are some of his thoughts on retirement planning.


What can I do now to make sure I have a successful retirement and not run out of money?

There are several things to consider. First, one should manage their living expenses so as to not live beyond one’s needs, today and in the future.

Second, do what you can to take care of your health. The costs associated with health care will continue to increase.

Third, consider working until at least full retirement age, which is age 67 for someone born in 1961, to receive Social Security benefits. Retiring earlier may reduce a retirees’ Social Security payment for the rest of their lives. Keep in mind, delaying Social Security payments until age 70, will increase your benefits 8 percent annually.

Fourth, invest as much as possible for as long as you can and diversify your investments according to your risk tolerance. It is very important to think long term, as your investments will provide for your needs for potentially another 20 years or longer after retirement.

Finally, this world is complex. It is important to seek independent, professional advice from people who are qualified to provide it and not trying to push a product.

Should I pay off my house early?

Depends. Paying 4-percent interest is near all-time lows for a mortgage. Compare this to the return one could expect from a long-term investment. For example, if one believes he could get 6 percent from an investment, it may make more sense to invest and not pay the mortgage off early.


Are there certain investments a person can make before retirement that might help pay for living in a retirement home or nursing home? Should I consider buying nursing home insurance?

Yes. Purchasing any product with long-term-care insurance (nursing home insurance) is an individual choice and should be carefully evaluated taking into consideration a variety of issues, including overall goals and objectives, one’s financial and health circumstances, and the details of the product being considered.

Insurance companies offer hybrid products that are a combination of long-term-care insurance packaged with either life insurance or an annuity. The benefits of such a product provide the insured with life insurance or an investment if the long-term-care portion of the policy is not fully utilized.


What should my portfolio of investments look like when I’m retired? What percentage should be in stocks? Bonds? Annuities? Cash?

This is a unique decision for each person. Liquidity needs, cash flow, risk tolerance, goals and the objectives of the client must be taken into account in order to develop the proper plan. Of course, the plan will need to be flexible as circumstances change and, thus, need to be reviewed on a regular basis so as to meet the ongoing and ever-changing needs of the individual.


Penny Morgan, a registered Royal Alliance Associates Inc. representative who offers insurance and tax planning through Penny Morgan Financial Service, has more than 20 years experience in financial services. Here are her thoughts on retirement, the stock market and how to handle your 401(k).


I would like to use income from my investments to pay my living expenses in retirement. Is it possible to earn dividend and interest income in today’s environment? What are realistic yields?

It is possible for the interest and dividend payments from your investments to supplement your retirement income. Everyone’s income needs in retirement vary. Depending on how much you have saved over the years, what part is invested in dividend-paying stocks and how much is interest-based can help you determine if your investments will be a good source of retirement income.

In this low CD rate market, bond yields and stock dividends have been seeing yields of 1 percent to 3.5 percent.

There is a difference between yield and value. When investing in the market, you have fluctuation in values that occur on a daily basis. There are also different tax rules on interest income versus dividends. Currently, qualified dividends are taxed at tiered rates with a maximum taxation rate. Interest income is always taxed at your current income tax level. It is always wise to talk to your tax preparer and a financial adviser.


The stock market reached all-time highs recently. Is it still a good time to invest in stocks and bonds?

Dollar cost averaging — investing on a regular basis, usually every month — levels out the extreme highs and lows in the market. An “all-time” high doesn’t mean that the market will never go any higher, and it doesn’t mean that the market might not fluctuate in a downward trend. But historically, we have seen the market increase over various periods of time. Company stocks that have historically paid dividends may still pay dividends even if their stock price drops.

The payment of dividends is not guaranteed. Companies may reduce or eliminate the payment of dividends at any given time. If the stock price goes down, you can buy more shares for your dollar.

The same happens with bonds. Bonds will continue to pay interest based on the payment schedule, and the value of the bond will change depending upon the current interest rates.

Studies have shown that the longer you wait to get in the market, the less you participate in the growth and income of it. In some cases, it’s not timing of the market, but time in the market.


What should I do with my 401(k) after I retire?

There are many options out there after you retire. Consider a rollover to a traditional IRA to consolidate your 401(k)s, if you have worked for several companies. Look at the costs and flexibility involved with leaving it with your employer.

Other retirement assets, your age and year of retirement all should be taken into consideration before you do anything with your 401(k). If you are age 70 ½, you will have minimum mandatory distributions to you from your retirement accounts.

Since each choice has its own implications, it is recommended that you discuss and compare all potential fees, expenses, commissions, taxes and legal ramifications with your qualified adviser before making a rollover decision.

RELATED: Read more retirement stories in our special section here.

Related: See the digital copy of the 2016 Retirement Special Section here.

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Prime Time, a special section in Sunday, Oct. 10, 2016's issue of The Topeka Capital-Journal, explores the issues facing individuals as they approach retirement age, including downsizing and housing options, financial planning, questions to ask when transitioning into an independent living or assisted living facility and caregiving considerations.

The special section also features a directory of amenities at independent living and assisted living facilities in northeast Kansas, as well as a list of community resources that senior citizens and their families may find helpful. Additional stories and photos can be viewed at