Janelle is 57 and she plans to retire in eight years. She has always been an aggressive investor with a significant portion of her Plan investments in the Equity Fund. Although retirement is just over the horizon, Janelle is not dependent on her investments within the Plan for her daily expenses at retirement, as she has been fortunate enough to build significant financial assets outside the Plan.
“It’s time to consider restructuring my investment mix with the Plan. From myCSSPEN, I can see that I have reached my retirement savings goal with the Plan, but I would like to maximize the inheritance I leave to my children. Besides, I still have some time to invest before retirement, so I would love to continue to invest in equities to maximize my returns while I still can,” Janelle concluded after attending a Retirement Income Options (RIO) workshop.
Janelle’s goal is to stay invested in the Plan even after retirement. However, knowing that she plans to retire in eight years, she believes it is prudent to re-evaluate her current investment mix.
Janelle’s use of the online Risk Tolerance Estimator confirmed that the aggressive investor profile best describes her, and that she should consider an asset mix of 50% Balanced Fund and 50% Equity Fund.
She scheduled an appointment with her financial advisor to assess her present circumstance and to discuss the change in investments she was contemplating. Her financial advisor pointed out that Janelle already has about five years of retirement income in guaranteed investments outside the Plan so there will be no immediate need for Janelle to move her Plan investments into cash to support her retirement income needs. Her discussion with her advisor concluded in agreement that Janelle hold her CSS investments in an even mix of Balanced Fund and Equity Fund.
“I’m glad I spoke with my financial advisor before changing my investment mix. He confirmed that my investment plans are appropriate for my circumstance. Going forward, I will monitor the performance of my Plan investments and then check in with my advisor closer to my retirement date to determine whether I should consider any further changes at that time,” Janelle says.
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