Retirement and Retirement Income Planning

Would you feel better if you had the resources needed to retire comfortably?

The assets you have accumulated for your retirement most likely are in an Employer Plan (401 (k), etc), an IRA, a company pension, or individual investments.  Many individuals or couples realize too late that  even with all the different sources added together it may not be enough to maintain their standard of living after retirement.  And coming up with a plan to move from accumulation and saving to income generation can be overwhelming.  Selecting investments from a lineup of choices provided by your employer in your 401 (k) is much easier than deciding which of those investments to sell each month to provide income. 

Some financial advisors talk about using the 4% rule (take no more than 4% from a portfolio annually to preserve principal),  and illustrate the impact of withdrawals from a portfolio with the use of tools like Monte Carlo simulations.  The simulation runs random possible market movements using past returns and/or projected returns, resulting in a probability of success for the lifetime of a portfolio.  In recent years Morningstar, a firm that analyzes investments, has stated that a 3.8% (in 2023, up from their 2022 estimate of 3.3%) annual withdrawal may be more accurate in light of heightened volatility in the stock market. That means that if you have a $1,000,000 in your retirement plans, a possible 'safe' annual withdrawal of $38,000**. There has to be a better way for some one who has accumulated $1 million.*

And what if you live beyond the average life expectancy?  What will you do for income?

It is important to know how much you really need to live securely, including living longer, and plan for that amount of income in retirement.  

Another concern that is surfacing more and more is the cognitive abilities of seniors as they live much longer. When and to whom do you turn over the control of your assets?  Have you even considered this option?  Many serious financial mistakes have been made when the person making financial decisions waits too long and takes risks that result in tragic losses.  Running out of money and the uncertainty of potential medical costs as you age are two significant worries.  Will there be enough money available for medical needs on top of basic living expense needs?

Let us help you to find the right combination of products to help secure a lifetime income while also working to anticipate the need for funds for your health care.

*morningstar.com/articles/1128840/whats-a-safe-withdrawal-rate-today.  **There is no guarantee that investment objectives will be achieved.