​Are you preparing to retire? If so, this is probably an exciting time. You’ve worked and saved your entire career to get to this point. Very soon, you’ll be able to spend your time as you wish, without the constraints of career and work.
 
While retirement is a major accomplishment and an important milestone, it’s not always a joyous occasion. Some retirees struggle to make the transition. In fact, a recent study in the Journal of Population Ageing found that retirees are twice as likely to experience symptoms of depression than those who are still working. ¹
 
What could be depressing about not working anymore? Everyone’s situation is unique, so there aren’t universal answers to that question. However, there are a few common challenges that many retirees face, especially in their first year of retirement. You can make the transition easier by planning ahead. Below are a few issues you may want to consider as you finalize your retirement strategy:

Lack of Purpose 

If you’re like many people, you’ve worked in some form or another for several decades. In fact, you’ve probably spent more of your adult life working than with any other activity. Even before you started your career, much of your time was probably focused on school or extracurricular activities.
 
For many, retirement marks the first time in their life where there isn’t a primary mandatory activity. You don’t have to wake up at a certain time to be at work. There aren't any tasks to complete or meetings to attend. Your time is yours to manage as you please.
 
While the freedom of retirement might be appealing, you may feel like you don’t have any purpose. You may want to think about how you will spend your time in retirement. What is important to you? What does your ideal day look like? Do you want to travel? Or perhaps learn a new hobby? Think about what your purpose will be and what activities will make you happy.

Loneliness 

For many adults, work isn’t just a source of income. It’s also their primary place to socialize with other adults. Think of your network of associates and friends. How many of those relationships were formed during work-related activities?
 
Once you retire, you won’t have an office or workplace to go to. That means you may not have a natural opportunity to socialize with others. Think about ways in which you can get out of the house and interact with other adults. For example, you could join a golf league, or a club related to a favorite hobby. You could volunteer for a local charity. Some retirees even take low-pressure part-time jobs just so they can spend time around other people.

Overspending 

Once you retire, you’ll have more free time available than you’ve likely ever had in your life. You also may have more money available than you’ve ever had, between your retirement assets, defined benefit pension income, and Social Security.
 
Many retirees fill their free time with costly activities, like travel, shopping, and dining out. It’s natural to want to enjoy your retirement. However, be careful not to overspend during the early years of retirement. You could put yourself in a difficult financial situation in the later years. A financial professional can help you develop a budget and implement an income strategy.
 
Ready to plan your upcoming retirement? Let’s talk about it. Contact us today at Humphrey Financial. We can help you analyze your needs and develop a plan. Let’s connect soon and start the conversation.
 
1 | https://www.usatoday.com/story/money/2019/06/11/depression-during-retirement-how-cope-and-prepare/1416091001/
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
 
19149 - 2019/8/19

Fall is here. Ok, it’s not actually official until September 22. However, the unofficial start of fall arrived in late August. Starbucks added pumpkin spice drinks to their menu. For many, that’s a surefire sign that cooler weather, football, and fall bonfires are right around the corner.
 
While fall may be a favorite time of year for many people, it hasn’t historically been a great season for investors. In fact, September is historically the worst month for stock market returns. Going back to 1950, the Dow Jones Industrial Average (DJIA) has a -0.8% average return in September while the S&P 500 has a -0.5% average return.1 Those averages are worse than the average return for any other month.
 
September isn’t down every year, but it happens frequently enough that the phenomenon has generated a nickname - the September Effect. What’s the cause of the September Effect? And how can you prepare? Below are some tips and guidance to help you plan.

Why does the September Effect happen? 

There’s no clear answer why the September Effect happens. Or even if it’s a real phenomenon at all. Some people think it’s related to tax planning. People sell down positions before the fourth quarter in order to harvest potential tax losses. The widespread selling causes a downturn in the market.
 
Others suspect that the phenomenon is related to the end of summer. People think about their portfolio and investments over the summer, but don’t take action because they’re busy with vacations and other activities. After summer is over, they sell positions and make adjustments and, again, the widespread selling causes a slight downturn.
 
Of course, there’s also the possibility that there is no actual cause. It’s possible that the phenomenon is completely coincidental. It doesn’t happen every year. In fact, over the past 25 years, the median return in September for the S&P 500 has been positive.1 It’s possible that there is no actual September effect and the historical returns are a matter of circumstance.

How do you prepare for the September effect? 

you may be curious about how you should prepare for the September effect, or if you should at all. The short answer is that it usually isn’t wise to plan your retirement strategy based on short-term expectations.

While September may have a history of being negative, that doesn’t mean it always is. Also, it’s incredibly difficult to predict the market’s movement in the short-term, if not impossible. You could make changes to your strategy in expectation of a downturn and the market could do the exact opposite.
 
Instead, focus on your long-term strategy. Your retirement planning approach should be based on your unique goals, needs, and risks. That strategy shouldn’t change just because one month may have poor returns.
 
If you don’t have a long-term retirement strategy, now may be the time to develop one. Let’s talk about it. Contact us at Humphrey Financial. We can help you analyze your needs and implement a strategy. We can help you analyze your goals and possible risks and implement a plan. Let’s connect soon and start the conversation.
 
1https://www.investopedia.com/ask/answers/06/septworstmonth.asp
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
 
19184 - 2019/8/23