By Pat Lizza, Branch Manager with UBS Financial Services Inc.

Palm Springs, CA

Did you know that  32.4% of the population in Palm Springs is 65 and over and the median age of this community is 56.6? If you’re in this group, you may be exploring retirement or could possibly already be retired. After years spent working, building businesses, and/or having successful careers, you may decide it’s time for this next journey. But, with the volatile economy, many are wondering if they can afford to retire, or even if already retired, perhaps they should go back to work at least part time.  

A recent investor sentiment survey from UBS indicates 52% of investors are still optimistic about the stock market and almost a third sat they will increase investments if the market goes up or down by 10%. Yet, 63% are still concerned that we may be in a recession by year end.

An individual’s prospects for retirement are inextricably linked to finances, planning and investment performance. For some, that might look particularly challenging right now.

As with any challenge, having a strategy in place may be helpful to achieving your goals. You might discover retirement is more achievable than you anticipated, or you may consider postponing it a few months, or go with a stepwise approach, which might be even more advantageous from a tax point of view. Regardless, it’s best to have a plan focused on your personal and family objectives.

Following are just a few points to consider.

  1. Consider Your Budget and Financial Plan – Identify your priorities and how your lifestyle might change in retirement. Start by establishing an overview of your current cash flow needs to determine a structure for your future investment requirements. Consider:
    a. Immediate needs: enough to cover 3–4 years’ worth of expenses and to weather uncertainty
    b. Longer-term objectives, including higher healthcare and long-term care costs
    c. Legacy that you might leave to children, grandchildren, charities.
  2. Examine Liquidity – The COVID-19 pandemic illustrated the importance of having enough cash to withstand a storm. According to the Pew Research Center, 52% of investors say they have cut back on expenses if they can, to preserve capital they plan to invest over the next few years. Others are considering stable/safer assets (like cash and short-term bonds) to cover spending to get through a crisis. Having a financial plan can help take emotion out of investing by offering clearer understanding of your current needs and preventing you from selling when the market has suffered losses. If you’ve set aside enough to cover short-term spending needs, then there should be no need to sell equities.
  3. Consider the Future – Plan for a long life ahead; the average life expectancy in California is 80+ years. Make sure you hold assets earmarked for longer-term spending for capital appreciation for when the market, most likely, will have recovered. Basic principles to consider: staying invested for the long term, diversifying across asset classes and geographies, and regularly rebalancing.
  4. Weigh Borrowing as an Option to Avoid Potential Cash Flow Shortfalls – Being forced to sell equities during an equity market crash to pay expenses or cover loans could derail retirement plans. Sometimes, borrowing may be a vital component of a financial plan to create sufficient cash flow while reducing the drag of holding excessive cash or selling assets with high expected returns at volatile market prices. It can be attractive when interest rates are still relatively low. Assess your financial needs to warrant a capital cushion and you won’t need to ask for more collateral.
  5. Make a Difference – How do you wish to leave your mark? A legacy portfolio should be less focused on day-to-day volatility, intended to grow over years or decades. For legacy planning, you can choose strategies that might offer long-term, after-tax performance. And remember to discuss it with your heirs to help minimize conflict.

What do you want from retirement? A first important step is to plan for the financials so that everything else can follow.

Pat Lizza is Branch Manager with UBS Financial Services Inc.,a subsidiary of UBS Group AG. Member FINRA/SIPC in the Indian Wells, Californiaoffice and a member of Aligned Wealth Partners. Aligned Wealth Partners has built a comprehensive wealth management business/team serving select professionals, entrepreneurs, retirees and their families. With financial planning at its core, the team recognizes that every client has a unique set of circumstances and aspirations and employs a detailed discovery process that enables them to develop customized strategies specific to the client’s needs. Pat and his wife, Tricia, live in La Quinta and have two grown children, Meg and Hogan. He can be reached at

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