Bills, Bills, Bills

As the infamous ‘Queen B’ aka Beyoncé, sang:

“Can you pay my bills, can you pay my telephone bills, can you pay my automo-bills (her spelling not mine) ….”

In this Grammy nominated song (yes, it was nominated for a Grammy- don’t judge), the lead singer of the music group Destiny’s Child was, of course, was referring to someone else paying her bills.  Wouldn’t that be nice?  I’d also like to hit the lottery, but the reality is that we are all responsible for paying our bills now and covering similar expenses in retirement.

Yet the way in which we pay our bills now and plan to pay our bills later is very different.  If you think about your current expenses, most of them are monthly.  You receive a monthly mortgage/rent bill, a monthly phone bill, a monthly car bill and so on.  You likely budget other variable expenses like gas, groceries and spending money by the month. 

So why is it when it comes to retirement, everything is a lump sum?  Your IRA rollover and 401K statements come quarterly, which is good, but all you typically see is a balance and any gains or losses.  At one point or another, you’ve probably watched the commercial where hopeful individuals hold signs with ‘their number’ representing their entire projected account balance at retirement.

When we spend our whole lives budgeting monthly, how are we supposed to know if ‘our number’ at retirement will be enough to cover our expenses?  Even though we’re in retirement, those bills, bills, bills will still be coming monthly.

That’s why at Unified Trust, our UnifiedPlan® Managed Account Solution statements and our Managed Rollover statements are broken down into monthly dollars.  Retirement investors are not only able to see what they are projected to have monthly in retirement, but also what they are going to need monthly to cover expenses and whether they are on track to achieve that goal.  If an investor’s not on track, we also provide some helpful suggestions on how to get there.

We recently heard from a plan sponsor that the statement is one of the top three reasons why they choose Unified Trust as their retirement plan provider along with reduced fiduciary liability and increased transparency (in no particular order). 

Would you ever think that a statement, a piece of paper or a digital report, could be that impactful?  According to the sponsor, participants previously would see the total balance and, being a larger figure than what they typically have to work with, they felt good about being prepared for retirement.  However, once it was broken down into monthly dollars, they knew the truth.  They had much more work to do, because in reality, it wasn’t going to cover their monthly bills. This knowledge pushed them, to not only keep saving, but save more.     

When you think about it, we are saving to be able to purchase our retirement, arguably one of the largest purchases we’ll ever make in our lifetime.  So, we should plan for retirement in the same manner we pay our current monthly expenses.  This helps participants understand whether they are on track to achieve a successful retirement outcome.  Saving more now, creates opportunities later, like sitting front row at Beyoncé’s comeback tour at age 80! One could only hope, right?

Most wouldn’t think a statement could change lives.  We’d disagree.  Reach out and we’ll show you why.

Advisor.services@unifiedtrust.com

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