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The LynnLeigh JournalLife. Investing. And Everything in BetweenWhen planning for retirement, it's easy to assume that yourexpenses will drop significantly. After all, once you're no longercommuting to work or spending on professional clothing andlunches, the cost of living should go down, right?Not necessarily. While some costs will decrease, others—likehealthcare, leisure activities, and inflation—can actually causeyour spending to increase. Let’s break down what you shouldreally be watching out for to avoid a costly retirement shortfall.RETIREMENT READY: A GUIDE TO ASECURE AND STRESS-FREE FUTUREBy Kelly L. Olczak, CFP® NewsletterHighlightsS E P T E M B E R 2 0 2 4V O L U M E 9Fall Into a Good Book:Cozy Reads for ChillyNightsThe August-SeptemberMarket Rollercoaster:Buckle Up and Ride theWaves!UnderestimatingRetirement Expenses: ACostly MistakeThe Silent Impact ofInflation on Your Nest EggLongevity Planning:Making Your Money LastKeeping Your FamilySafe The Historical August-September Market QuirkFed’s Upcoming Rate Cutsand Their ImpactUnderstanding MarketCorrectionsUnderestimating Retirement Expenses:A Costly Mistake

S E P T E M B E R 2 0 2 4 V O L U M E 92As we age, medical costs tend to rise—sometimessignificantly. While Medicare helps, it doesn’tcover everything. Prescription drugs, long-termcare, dental, and vision expenses can add upquickly. It’s important to plan for these, asunexpected healthcare costs are one of the biggestbudget busters for retirees.What to Watch For:Tip:Create a detailed budget and Account for inflation: Tools like the RetirementNeeds Calculator can help you project future expenses more realistically.Inflation is one of those factors that people often forget about, but it can have a profound impactover time. What costs you $100 today could cost $150 or more in 10-15 years, depending on inflationrates. If you’re living on a fixed income, this means your purchasing power steadily declines,making it harder to maintain your standard of living.Check out How Can Your Protect Your Portfolio Against Inflation?Learn More:Inflation: The Silent ErosionHealthcare Costs: The Hidden Giant

3S E P T E M B E R 2 0 2 4 V O L U M E 9Today, people are living longer than ever. Ifyou retire at 65, you might need to fund yourlifestyle for 20, 30, or even 40 years. Withmore years comes more expenses, fromhealthcare to housing maintenance. It’scrucial to ensure that your savings arestructured to last as long as you do.Revisit your plan regularly and consider income streams like annuities orpart-time work to stretch your resources further.Pro Tip:Creating a Solid PlanThe best way to prepare for these challenges is by creating a detailed, realistic budget. Don’t justfocus on today’s costs—think ahead and plan for what could change in 10, 20, or 30 years. It’sessential to keep revisiting this plan to adjust for new expenses, inflation, and potential lifechanges.By planning carefully, you can make sure your retirement years are as comfortable and worry-free as possible.The Silent Impact of Inflation and Taxes on Your Nest EggWhen planning for retirement, it's easy to focus on the amount you've saved. But two factorsthat can quietly erode your nest egg are inflation and taxes. These forces can significantly reducethe value of your savings and affect your purchasing power over time.Longevity: Outliving Your Savings

4S E P T E M B E R 2 0 2 4 V O L U M E 9Inflation may seem like a small factor year toyear, but over time, it adds up. Even withmoderate inflation, the cost of everyday itemsincreases steadily. What costs $100 today maycost $150 in 15 years, which means yourretirement savings could lose a significantportion of its purchasing power if you don'tplan accordingly.Include inflation in your retirement projections. Use inflation-adjusted toolslike the TIPS (Treasury Inflation-Protected Securities) to help protect yoursavings from inflation's long-term effects.Tip:What to Watch For:Taxes can chip away at your retirement income in ways you may not expect. Different retirementaccounts are taxed differently. For example, withdrawals from a traditional IRA or 401(k) aretaxed as ordinary income, while Roth IRA withdrawals are tax-free. Understanding thesedifferences can help you strategize and reduce your tax burden in retirement.Work with a financial advisor to develop a tax-efficient withdrawal strategy.Consider converting some of your traditional retirement accounts to RothIRAs before retirement to reduce your taxable income later.Tip:Inflation: Gradual Erosion of PurchasingPowerTaxes: Unexpected Reduction in Your Income

5S E P T E M B E R 2 0 2 4 V O L U M E 9Planning for Inflation and TaxesIt's important to plan for inflation and taxes just as carefully as you plan for healthcare or day-to-day expenses. These factors can silently shrink the value of your retirement income andleave you with less money than anticipated. Regularly reviewing your financial strategy andkeeping your plan flexible can help ensure your nest egg is protected from these quiet butpowerful forces.Pro Tip:Make sure you’re accounting for both inflation and taxes when mapping outyour retirement income. Tools like the Retirement Needs Calculator can helpyou adjust for these variables.Longevity Planning: Making Your Money LastWhat to Watch For:With advancements in healthcare andlifestyle, people are living longer thanever. While living a long, fulfilling lifeis certainly something to celebrate, itbrings a unique challenge forretirement: making your money last.Extended Lifespan: More Years,More ExpensesPlan for a longer retirement than you might expect. Use tools like the SocialSecurity Life Expectancy Calculator to estimate how long your retirementsavings will need to last.Tip:If you're planning for a retirement that could stretch 20, 30, or even 40 years, it's critical to consider howyour savings will support you for the long haul.

6S E P T E M B E R 2 0 2 4 V O L U M E 9Healthcare Costs: A Growing Burden Over TimeHealthcare expenses can increase significantly in later years. As we age, we may need morefrequent medical care, prescription drugs, or even long-term care. These rising costs canquickly deplete your savings if you don’t plan ahead.Pro Tip:Consider long-term care insurance or set aside funds specifically forhealthcare. Resources like the Genworth Cost of Care Survey can help estimatefuture healthcare expenses.Building a Plan for LongevityTo prepare for a potentially longretirement, consider diversifying yourincome sources and includingguaranteed income streams likeannuities. Additionally, factor in risinghealthcare costs, inflation, and anyfamily support you might provideduring retirement. Regularly reviewyour plan to ensure that it aligns withyour evolving needs.Pro Tip:Use a mix of growth investments and income-generating assets to help ensureyour money lasts as long as you do. The Retirement Income Calculator is auseful tool for projecting how long your savings will hold up based on yourwithdrawal rate.

7Last month, we cautioned you about a calendar quirk that sometimes surfaces in August andSeptember.Briefly, “Since 1970, the average monthly return for the S&P 500 Index (excluding dividends)has been +0.09% during August and -0.96% in September, according to S&P 500 data providedby the St. Louis Federal Reserve.”S E P T E M B E R 2 0 2 4 V O L U M E 9The August-September Market Rollercoaster: BuckleUp and Ride the Waves!On the first day of August(Thursday), investors began tofret about the economic outlook,and stocks began to slide.At the close on Monday the 5th,the S&P 500 Index hit a near-term bottom, shedding 6.1% inthree days of trading, accordingto S&P 500 data from the St.Louis Federal Reserve.Almost half of the selloff occurred on Monday after what can only be described as a washout inJapan. According to Reuters, Japan’s best-known market gauge fell 12% that day, the worst one-day selloff since 1987.We won’t blame the month of August for the brief bout of volatility. Markets may react tovarious events in any season.Notably, from its peak on July 16, the S&P 500 Index gave up 8.5% through August 5.According to LPL Research, the S&P 500 averages a 10% correction or more every 12 months.The last such 10% pullback occurred almost a year ago.

8What happened in the three weeks between July 16 and August 5 is not unusual. Although theyare difficult to predict, market pullbacks are to be expected. What would be unusual? Acalendar year in which we experience very little volatility.S E P T E M B E R 2 0 2 4 V O L U M E 9Intuitively, investors understand that market corrections are a part of the investing landscape.However, when a pullback occurs, it can lead to anxiety.As we rolled through August, negative sentiment surrounding the economy began to fade,stocks began to recover, and the Dow Jones Industrials notched several all-time highs,including the final day of August, according to MarketWatch.Additionally, Fed Chief Powell offered up his clearest signal yet that the Federal Reserve isgearing up to cut interest rates this month when he said in a speech near the end of August.“The time has come,” he said, “for (monetary) policy to adjust. The direction of travel is clear,and the timing and pace of rate cuts will depend on incoming data, the evolving outlook, andthe balance of risks.”

9There’s no wiggle room in his remarks. The Fed is aiming for a rate cut at its Septembermeeting.Beyond that, the economic data will likely determine if rate cuts are aggressive or modest.S E P T E M B E R 2 0 2 4 V O L U M E 9Conventional wisdom suggests that lower rates benefit investors. But we believe it’s essential toadd one caveat, that is, when modest rate cuts are accompanied by economic growth, whichunderpins corporate profit growth.According to data from CNBC, FactSet, and the St. Louis Federal Reserve, the S&P 500 Indexrose in the 3-month, 6-month, and 12-month periods (following the first rate cut) in 1984, 1989,1995, 1998, and 2019, as a near-term recession was avoided.Market Action and Rate CutsHowever, rate cuts in response to economicweakness—2001 and 2008—did little tosupport equities. Despite the fact that ratecuts during the respective recessions wereaggressive, the S&P 500 Index slid into a bearmarket.Please note that these are historical patterns.Past performance is not a guarantee of future outcomes. The data above are simply a historicalrecord.

10S E P T E M B E R 2 0 2 4 V O L U M E 9As the days get shorter and the temperatures drop, there’s no better way to spend a crisp fallevening than curling up with a great book. Whether you're a fiction fanatic, love aheartwarming memoir, or are looking for something thought-provoking, we've got youcovered with some perfect fall reads to dive into this season.Fall Into a Good Book: Cozy Reads for Chilly NightsFiction: "The Night Circus" by Erin MorgensternA mesmerizing, magical tale set in a circus that only opens at night. With its lush proseand dreamlike atmosphere, this novel is the perfect escape for fall, with just a hint ofmystery to match the season's crispness.Memoir: "Becoming" by Michelle ObamaIf you're in the mood for an inspiring memoir, Michelle Obama's journey from the SouthSide of Chicago to the White House is a candid, warm, and thought-provoking read.Perfect for those looking for motivation and a reminder of personal growth as wetransition into a new season.

11S E P T E M B E R 2 0 2 4 V O L U M E 9Historical Fiction: "The BookThief" by Markus ZusakThe first in Penny's beloved Inspector Gamache series, this cozy mystery set in a picturesqueQuebec village is perfect for fall. The intricate plot and charming characters will pull you in,making it ideal for reading with a cup of tea on a chilly day.Cozy Mystery: "Still Life" by Louise PennyWe’d love to know—what’s your favorite fall read? Share your recommendations with us,and let’s create the ultimate cozy reading list together. Feel free to send your suggestionsor join our informal Fall Book Club by replying to this email. You might even discover anew favorite through fellow readers!This unforgettable World War II story isnarrated by Death itself, following ayoung girl's life in Nazi Germany.Thought-provoking, heart-wrenching,and poetic, it's a book to get lost induring long autumn nights.Feel-Good Fiction: "Eleanor Oliphant Is Completely Fine" by Gail HoneymanLooking for something uplifting? Eleanor Oliphant’s quirky yet touching story of isolation,friendship, and self-discovery is both heartwarming and laugh-out-loud funny. A great pick tobrighten up a gloomy fall afternoon.Share Your Favorites!

As the season of gratitude approaches, we want to take a moment to thank you for being a part ofour community. Whether you're sipping apple cider while reading this or gearing up for a cozyevening by the fire, we’re grateful that you’ve taken the time to spend a little of your fall with us.We hope this month’s tips help you navigate both the financial and fun aspects of the season.Remember, whether you’re preparing for retirement or simply enjoying life’s little moments, we’rehere to support you every step of the way.From everyone here at LynnLeigh & Company, we wish you a warm, wonderful, and peaceful fallS E P T E M B E R 2 0 2 4 V O L U M E 912LynnLeigh & Company - A Registered Investment AdvisorThis information is provided by LynnLeigh & Co. for general information and educational purposes based upon publicly available information from sources believed to be reliable – LynnLeigh& Co. advisors cannot assure the accuracy or completeness of these materials. The information presented here is not specific to any individual’s personal circumstances. To the extent that thismaterial concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. Each taxpayershould seek independent advice from a tax professional based on his or her individual circumstances. The information in these materials may change at any time and without notice. Pastperformance is not a guarantee of future returns. Wrapping Up with Gratitude...