If you want to maintain your purchasing power and base it on a 4% inflation rate, you need to increase your income by approximately 50% every ten years. And although your Social Security payments are indexed to rise with inflation, payments from many corporate pension plans are not. Thus your investment portfolio must be allocated so as to provide the growth in capital that you will need to keep up with increasing costs.

The level of income that you retire with may seem adequate in the beginning. However after several years with rising costs of products and services you find that your purchasing power has diminished. This illustrates the importance of continuing to make prudent investment decisions even after retirement.

When couples retire, it is time, if it has not been done previously, that both partners become familiar with all aspects of the couple's finances. There should be an inventory of important documents including wills, life insurance, savings accounts, mutual funds, brokerage accounts, pension programs and any other financial documents or records. Even the single individual should take care to have their records "in order."

Make certain that you have a "rainy day" fund for when an appliance needs to be replaced or for larger expenses like a new roof or furnace.

DETERMINING YOUR INVESTMENT STRATEGY

Define Your Financial Goals
The most common goals are:

· Retirement
· Higher Education Expenses
· Buying a Home or Car

Decide Upon Your Investment Objective
A good rule of thumb when investing is to set aside three to six months of living expenses to cover any short-term emergencies without compromising your overall financial plan.

There are a number of tools and questionnaires available that can be used to help you determine your risk tolerance so that you can decide on what your best investment strategy is. For assistance contact your MEA Financial Services who is also a Registered Representative of Paradigm Equities, Inc.

Examples: Levels of Risk

LOW RISK - Minimal if any investment in stocks.

MODERATE RISK - Individual who wishes to avoid taking substantial risk with money for financial goals within the next few years. May have a small allocation to stocks, but understands that the volatility of their portfolio will increase.

HIGH RISK - Investing a larger portion of their assets in stocks than the moderate investor, but understands there is an increased risk of losing principal in doing so.