Most retirement calculators will fail you if you’re looking for lifetime income.
Even Congress recognizes this issue.
But you don’t have to worry or wonder anymore. Income Power allows you to plan with certainty!
Visit go2income.com/incomepower/ to find out how.
The earlier you get serious about retirement income planning, the better, whether you are in your 50s, or in your 60s but delaying full retirement. We will first distinguish between plain old retirement planning vs. creating a plan for retirement income, which this article will address.
Do you know what type of retirement product saw sales soar 44% in 2022 — and received praise and positive publicity in the finance field as consumers saw their other retirement investments lose value?
It’s not cryptocurrency! It’s not some hedge fund. Or junk bonds. It’s easily understood and won’t be seen as a fad in future years.
I’ve described it as a product that “doesn’t make your retirement; it makes your retirement better.”
So, what is it?
Its technical term is single premium immediate annuity, or SPIA. Some finance experts call it a simple annuity. As just one element of a plan for retirement income, I consider simplicity a plus, particularly when you read the positive reasons for the experts’ praise for this product. Others call it a paycheck annuity. It’s utilitarian. And I’ve used the term annuity payment contracts in earlier blogs. Whatever you call this annuity, it pays you a guaranteed income for life.
People planning for retirement often approach me, in person or through my blog, and ask questions about whether they have enough money to retire, hoping I can ease their minds or make life easier for them.
One client recently asked: “I’ve got 10 years to go before retiring. I’m contributing at the max to my 401(k). Can I afford to retire?”
Contributing as much as you can to your 401(k), or other savings vehicles, is an excellent start. To fully answer my questioner’s query, though, I directed him to Income Power. It gave him an idea of how much income he can generate from his current savings. (Congress is working on a bipartisan plan to make this retirement information mandatory for 401(k) plans.)
With this piece of good news, we talked about lots of options for his retirement income plan.
Feel free to contact me at Ask Jerry with questions about your own retirement.
Baby Boomers are the 401(k) generation.
When Boomers started working, nearly every major company offered some form of pension providing lifetime income. Now, as members of this cohort are retiring in large numbers, pensions are nearly extinct outside of government employers.
The 401(k) was invented 40 years ago and now shares the retirement landscape with Social Security. Many Boomers have a good amount of money in their 401(k) accounts, but that doesn’t mean they can stop planning. In fact, this is when critical retirement planning begins.
Everywhere you turn this time of year you will see a Top 10 list. Whether it’s automobiles, restaurants, vacation spots, chocolates or gardening tools, you will find someone willing to guide you.
I don’t think Top 10 lists always work for you, particularly when it comes to retirement security.
Let’s take restaurants as an example of why lists often fail. Unless you have your own jet, a list of Top 10 restaurants in the country won’t help you decide on a site for your anniversary dinner the next month. A more helpful list would describe restaurants within, say, 30 miles of your home.
Or perhaps you prefer Italian. Therefore, information on French, Indian or Vietnamese restaurants is not of much interest to you. Now you’ve narrowed it down to Italian restaurants within 30 miles of your home. But you prefer northern Italian cuisine.
Bottom line, before you start your search for the restaurant, decide what you want in terms of location, cuisine (even region) and, of course, your budget.