My client from California is a lawyer who owns multiple residential properties (all mortgaged) and had questions about their retirement & finances:
Context: S-corp grosses $2mil a year, with 3 FTEs. Salary from s-corp is $400k/year and distributions taken are $200-300k/year, depending on the year. Any remaining cash and profits stay in the company. Personal stock portfolio is around ~$1m.
Questions:
Is my stock portfolio overfunded or underfunded for retirement needs?
Are my kids’ 529s overfunded or underfunded based on years to college and target amount saved?
If I have extra $2000/mo cash flow a month, should I put it towards my primary residence mortgage each month and pay it off in 17 years, or put that extra $2000 into the stock market?
If that $2000 was better deployed in stocks, how should I allocate that across all my various tax-advantaged and brokerage accounts?
Based on my rental property (mortgage #3) cash flows and assumption of our 4% value increase year over year, is it a wise financial decision to hold onto this property until retirement?
How much income in retirement do I need to pull out of 401k (on top of social security) to be able to afford mortgage #2, comfortably?
Is it better to take social security at 62 instead of 65 based on my current income, projected income, and what happens with the cash flow on each of my properties?
Money decisions are rarely isolated questions.
These are the types of decisions that can impact your financial situation significantly in 10, 15, or 20 years down the line.
Sometimes the questions that come up, you might not even know that you have, until you’ve sat down with a professional to analyze your full retirement plan, all your financial accounts, your investment strategy.
You have to take into context basically your whole financial picture to see whether it makes sense.
Nothing worse than making a big move (liquidating a large portion of stocks, changing your portfolio strategy, buying a property, selling property, etc) without having considered all factors.
Book a spot here if you want to work together directly.
Best,
Alice