RETIREMENT ITEMS TO CONSIDER

MY INCOME SOURCES:

  • Social Security
  • Pension
  • Annuity
  • Rental Income
  • Royalties
  • Investment Income
  • Savings

Once you've identified your income sources, then you want to determine which ones will grow to keep up with inflation. Social Security has COLA (Cost Of Living Allowance). Some pensions and annuities include a COLA. Rental income can be increase by raising rental rates over time.

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HOW MUCH INCOME DO I NEED?

NEEDS:

When determining how much income you need in retirement, first make sure your income covers all your needs. These include:

  • Housing
  • Utilities
  • Food
  • Insurance
  • Transportation
  • Medical

Once you've totaled these, you can then compare that to the guaranteed income sources that you have. These would include any pensions, annuity payments, and Social Security. If your guaranteed income exceeds your income need, then you are all set.

If you need extra income to support the needs in your retirement, then the income gap may be closed by converting other assets into an income stream.

Be sure to account for inflation. If your pension or annuity doesn't grow with inflation, you need to do some additional planning.

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WANTS:

Wants are those extras that you would like to do during retirement, but they aren't critical to supporting your day to day life: These include:

  • Travel
  • Hobbies
  • Charitable Giving
  • Vacation Home
  • Boat
  • RV

Any additional cash-flow that you may have after ensuring that your needs are met, can be used for the wants in your retirement.

If you need extra income to support the wants in your retirement, then the income gap may be closed by converting other assets into an income stream.

Be sure to account for inflation. If your pension or annuity doesn't grow with inflation, you need to do some additional planning.

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MY RETIREMENT ASSETS:

Now that you've determined how much income you have available for your retirement, you may have discovered that you need to generate additional income.

Your decision at this point is whether you want the additional income to be guaranteed and not subject to market risk, or are you comfortable with income that can fluctuate?

If you want guaranteed income, then you should consider an annuity. While everyone's situation is different, a Fixed Indexed Annuity ("FIA") can provide you with lifetime income, no market risk, and even a COLA.

There are many variables to consider, and we would be happy to assist you in identifying the best annuity for your circumstances.

If you prefer the unlimited upside potential of being invested in the market, we have many managed portfolios that you could consider.

To discuss further, click: Schedule A Call

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RISK TOLERANCE

You should understand how much Risk you are comfortable with. This will give you an idea of how much you could lose in a down market.

Then compare your portfolio's risk to your risk tolerance. If they are not aligned, then you can make changes to bring them into alignment.

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MARKET RISK:

If you have five years or more before you retire and the market drops, you may have time to make up those losses. Once retired, most people use the assets they've accumulated to generate income to replace the money they received while working.

When you have to withdraw funds during a down market, you will have to sell more stocks to maintain the same income. Meaning you are not only locking in losses, but you are depleting your assets faster to maintain your lifestyle.

A good strategy is to have the assets that are providing for your retirement income needs not be at risk of market losses. Also, you could set aside a portion of cash to use in the event of a market decline, so that you don't have to sell assets at depressed prices.

Finally, in Retirement: Market losses will hurt you more than market gains will help you!

To discuss further, click: Schedule A Call

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