Your nest egg: a financial plan can make your golden years golden.

• Author: Johnson, Mike
• Position: Retirement Planning

The biggest problem with the ongoing bear market is that it's so, well, unbearable.

On top of that, the threat of war and its unknown impact on a sputtering economy keeps everyone on edge.

By making investment decisions based on what's right for an individual instead of what everyone else is doing, people can make sure their retirement plans will survive current market conditions.

So, what factors should investors consider in order to make logical decisions about their retirement plans? They should meet with their financial advisor to reassess their individual financial goals, risk tolerance, time horizon and asset allocation.

FINANCIAL GOALS

Every person's financial situation is different, and so his or her goals and needs are different. Whether it's a financially secure retirement, college education for children or a new house, all investors have financial goals they'd like to achieve. Once the goals are established, then a financial plan can be established to reaching those goals.

The difficult part comes in sticking to the plan. "You have to stop paying attention to others. Every person has different goals, different lifestyles. You have to focus on your own plan," advises Jeff Yu, vice president and senior managing partner at BED Wealth Advisors LLC in Indianapolis.

"Have a plan and be willing to stick by it. You'll get where you want to go," says Slug Glemmons, senior vice president and manager of retirement products and services for Old National Signature Group in Indianapolis. "If you don't have a plan, you're depending on luck to get you where you want to go."

RISK TOLERANCE

Closely tied to knowing your financial goals is knowing your risk tolerance. How much are you willing to invest on a regular basis? How well can you handle market downturns? Do you stay awake at night worrying about any of your investments?

Brett McKamey, chartered financial analyst with Goelzer Investment Management in Indianapolis, says both financial and psychological factors come into play when determining individual risk tolerance. "Your financial capacity to accept risk is based on your age, financial needs, income and your time horizon. Those are things you can work out with your financial advisor. Your psychological capacity to accept risk is something you have to decide on your own.

ASSET ALLOCATION

Maintaining a balanced, diversified mix of various stocks, bonds and money markets at all times provides a far greater chance of reaching financial goals...