Date: January 26, 2024

Building Enduring Wealth: Your Guide to Thriving at 100 and Beyond

In today’s world, where medical advancements, healthier lifestyles, and new technologies are extending life expectancies, living to 100 or beyond for one or both spouses isn’t just a possibility—it’s increasingly likely. This begs the all-important question: Have you saved enough to sustain your retirement lifestyle and financial security for 35 years? This is especially relevant if longevity runs in your family.

 This extended time horizon demands a fresh perspective on retirement planning that goes beyond traditional strategies and embraces the need for long-term financial plans. While this may sound relatively simple, it is not.

In retirement, the margin for error is slim – you need strategies that work right from the outset. You need to be very disciplined in budgeting and planning and have a proactive investment strategy to ensure your assets work for you with no unexpected risks.

As a fiduciary fee-only financial advisor in New Haven, CT., we specialize in helping successful, high-net-worth individuals and families create comprehensive retirement plans and investment strategies that can extend for their lifetimes and future generations.

Understanding the Role of Active Investment Management

There are two ways that your retirement savings can be invested: actively or passively. The choice between active and passive investing depends on investment goals, experience, and capacity for taking financial risks.

Passive investing focuses on producing market rates of return regardless of market conditions. It often involves investing in index funds or ETFs that track a market index, reflecting a long-term investment perspective with little or no change in asset allocations. This is more of a “set-it-and-forget-it” model for investing your assets. 

On the other hand, active management can tailor investment strategies specific to your retirement goals, time horizons, and risk tolerances. It is not so much about predicting future market performance as it is about reacting to current market conditions. Active investing offers several benefits, especially as a defensive strategy in volatile markets and for long-term retirement planning:

  • Active investing allows for quick adjustments to the portfolio in response to market fluctuations. This flexibility can be crucial in volatile markets, where quick decisions can protect against significant losses.
  • Active managers can employ various strategies to manage risk, such as hedging, short selling, and adjusting asset allocation. This can be particularly beneficial in uncertain markets.
  • While not guaranteed, active investing aims to outperform market indices, especially in fluctuating markets. This can include investing in undervalued securities or responding to market trends that may lead to higher returns.
  • Active strategies can focus on income-generating investments like dividend stocks or high-yield bonds, providing a steadier income stream that is based on rising and falling interest rates. 


Watch our founder, Paul Schatz, answer commonly asked questions about retirement planning strategies.


Understanding the Influence of Inflation on Your Retirement Journey

Your retirement savings and lifestyle are closely intertwined with inflation. Imagine your retirement savings as a boat sailing towards the horizon of your golden years. Now, picture inflation as the tide constantly shifting beneath you. 

When inflation rates are up, it will erode the purchasing power of your hard-earned savings. This means the dollars you’ve tucked away for retirement might not stretch as far as you’d hoped. Imagine planning a comfortable journey only to find that the cost of travel has unexpectedly increased. You can defer or cancel the trip, but that doesn’t work for retirement planning. You still have to buy groceries and gasoline.

This erosion has a bigger impact than the numbers on your bank statement. It translates into tangible financial challenges in your day-to-day life during retirement. 

 Everything you buy can be impacted by inflation and interest rates. When you are retired, and your income may be fixed or less than when you were working, adapting to these rising costs can be more than just a nuisance; it can be a source of real long-term stress.

Inflation doesn’t just impact your day-to-day expenses; it can also impact the performance of your retirement assets. You expected a 7% return after inflation, which is substantially lower than that. Do you take more risks to improve returns or reduce your cost of living?

Let’s say you have a portion of your nest egg invested in various mutual funds. You might see a positive return on this investment, but if inflation rises faster than your returns, your real return (net of inflation) could be negative. This is a crucial factor in ensuring the longevity and health of your retirement portfolio.

If longevity runs in your family, your retirement journey might be longer than expected. As they say, longevity can be a blessing (living comfortably the rest of your life) or a curse (running out of money late in life). Without a prudent plan based on reasonable performance expectations and inflation outlooks, your retirement savings erode faster than expected.

To understand the impact of inflation on retirement income and investment performance, let’s consider your scenario where you withdraw 4% annually from your retirement savings, and your investment portfolio yields an 8% return, but inflation is averaging 4% over longer periods.

After accounting for the 8% investment return and the 4% withdrawal, your portfolio would nominally grow by 4% annually. But, when you factor in the 4% inflation rate, the real value of your portfolio is flat. A zero real rate of return has long-term consequences for your financial security later in life.

Why Heritage Capital?

You’ve dedicated years to building your net worth, and now, as retirement approaches, it’s time for your money to start working just as hard as you have in the past. Finding the right financial advisor becomes a pivotal decision in this crucial phase of life. However, the reality is that not every advisor is as invested in your financial security as they should be. They still have to make a living from your assets.

Enter Heritage Capital, where our ethos is rooted in a deep commitment to your financial prosperity during your retirement years. 

As an award-winning personal investment management firm, we bring a blend of passion and expertise to the table, uniquely tailoring our approach to your individual needs.

At Heritage Capital, we pride ourselves on more than three decades of experience guiding clients through retirement challenges. Your assets are personally managed by our senior portfolio manager, Paul Schatz, an experienced professional whose expertise is sought after on channels like CNBC, Fox Business News, and Yahoo Finance.

For more than thirty years, Heritage Capital has had one clear mission: to grow and safeguard your money as you transition into decades of retirement years. We don’t settle for the standard “buy and hold” strategy or funnel your funds into lackluster mutual funds managed by third parties that increase costs.

Ready to learn more about our retirement planning services? Let’s connect for an introductory call.

plan a bulletproof retirement


Paul Schatz, President, Heritage Capital