Logan and Sarah Green (whose names and circumstances have been changed for confidentiality purposes) have come to Mission Wealth Management

After many years of making financial decisions in silos and merely reacting to events as they occur, they realize that they now need to take a proactive stance when it comes to their financial future. Without some adjustments and hard decisions, a comfortable retirement may become out of reach for them.

In a series of articles, we will demonstrate what steps Logan and Sarah must take to help them “get a grip” on their finances and be best prepared for their future.

At age 59, Logan is ready to “hang it up” from his faculty position at a local college. As much as he has enjoyed his career, he is yearning for more free time to pursue his creative writing projects and to work on his tennis game. He’d like to escape the day-to-day pressure of the classroom and is wondering when he can retire without having to risk changing the family’s current lifestyle.

At 53, Sarah runs a part-time graphic design business from her home. She loves the flexibility she has, and always finds time for her favorite hobbies of yoga and gardening. She would like to continue working but have the ability to travel with Logan when he retires and spend time with their soon-to-be born first grandchild.

Logan and Sarah have always approached finances very differently. He was raised by Depression-era parents and has always been a “saver” by nature. She has a “live for today” mentality and feels that life is too short to spend it worrying about the future.

He sees the large mortgage they have on their Mesa home and frets that it will limit their options in retirement. She loves her home and neighborhood and cannot imagine living anywhere else. Furthermore, she is desperate for a home remodel that includes a much-needed update to their kitchen and bathrooms. Logan can’t imagine that they can afford to put more money into the house, and feels they should try to reel back expenses if they want to be able to retire soon.

Logan is also feeling the pressure of having an aging mother in Washington state. Louise Green, 84, is in good shape overall, but she did have a recent health scare. She insists on staying in her family home, and Logan has concerns that she is not able to care for herself or the property and will need to move into an assisted-living facility in the near future.

Logan’s only sibling lives abroad, so the burden of providing care for his mother falls solely on his shoulders. One of his primary goals is to measure her current resources to see how long they will last and to plan so that he has enough resources available if he is on the hook for her medical or care needs in the future.

Logan and Sarah’s three children are also a part of their financial plan. Their eldest, Sarah’s daughter from her first marriage, is married and expecting her first baby this fall. They would like to help their first grandchild get a head start on saving for college by establishing a college savings fund.

Their son will be graduating from a UC school next year. Logan and Sarah have been covering his tuition costs through cash flow, but they may not be able to continue this same level of support when Logan retires or if their son decides to pursue a graduate degree.

Their younger daughter, a junior in high school, is on a strong academic path and is also a soccer star. They hope that she will get into a great college where she can play collegiate sports, but they fear the high cost of that education if she does not get scholarships! They do have money set aside in a 529 plan, but it may only cover two years of school expenses.

The Greens are seeking Mission Wealth Management’s guidance in sorting through these overlapping financial priorities. They need help clarifying a realistic timeline for retirement, confirming that there are enough assets to support their lifestyle, and prioritizing their goals with respect to supporting family members and remodeling their home.

Stay tuned for our next column, in which we reveal retirement resources, liabilities, investment objectives and the underlying issues that need to be overcome for a successful plan to be developed on the Greens’ behalf.

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— Dannell Stuart CFP, ChFC, CLU, CASL is business development director at Mission Wealth Management. She can be contacted at dstuart@missionwealth.com. Click here for more information.