Become Your Own Pension Manager
I’m an actuary by training and I had two potential career paths when I passed my last actuarial exam (there were 10 of these exams when I finished):
- Pension consulting
- Life insurance company new product development
I picked the latter. Then, as my career progressed, I moved from life insurance to retirement, and from product development to retirement planning. With this experience, I was able to develop the Income Allocation planning method that integrates annuity payments into a plan for retirement income.
The Market and Our Clients Have Brought Me Back to Pensions
To meet the needs of our clients, I’ve had to come full circle – back to pensions.
Individuals who approach me for advice on how to manage their retirement finances, often wish out loud that they could rely on an old-fashioned pension like their parents had when they retired. These individuals knew mom and dad appreciated the check(s) that appeared in the mailbox every month without regard to what the stock market was doing or how old they were
As many people nearing retirement age lament, traditional pensions are just about gone – having been replaced by 401(k) and other defined contribution plans. With little or no help from their HR departments at work and not able to afford a pension consultant, they’re on their own to create retirement income security. They have had to become their own pension manager.
Become a “Pension Manager of One” with Go2Income
There is good news, however! That’s because the Income Allocation planning method and other services at Go2Income offer a way for investors to become their own pension manager. You will continue to rely on your own savings, but you will find our solution can create for you much the same feeling that your parents enjoyed: Fewer worries about the stock market, and confidence in a steady stream of income that arrives in your bank account without fail every month.
To do this you need the tools that a traditional pension manager in a large corporation has at her disposal. Besides the resources of a large company this “pension manager of many” has a number of built-in advantages:
- Corporations and governmental units create pensions for large groups of people, which creates an automatic advantage in the pooling of longevity risk. The risk is spread over these many individuals in order to make sure pensions are paid as long as retirees live, just like an insurance company does.
- Even if the stock market implodes for several years, pension fund managers don’t worry too much because active employees have not retired yet. And the company can increase its pension funding, giving the manager plenty of time to rebuild the fund as the markets recover.
- Of course, the manager is not working alone. He has a team of actuaries who compute expected lifespans and market returns. Money management companies bid for the pension fund’s business and task their professional investors with choosing products for stability and the most favorable returns.
Specific Tools You’ll Need
You can design a pension for one or two, also, if you have the pension manager tools. (Of course, what you don’t have is another money spigot you can turn on to make up for losses. Talk about pressure.)
But you do have Go2Income’s tools. Let me briefly address them:
1) Pooling of longevity risk – integration of lifetime annuity payments from a choice of highly rated annuity carriers. Annuity payments continue for the rest of your life, or the life of a beneficiary who survives you.
2) Mechanism to survive markets’ ups and downs – plan management that keeps your plan on track. A portion of your savings will remain in the market, but not so much that your income dries up when the market crashes.
3) Access to professional resources – an advisor counselor — with access to a low-cost investment platform. You will pay yourself first – not a financial advisor.
And, of course, you’ll have the benefit of my experience in building Go2Income.
Are you ready to let Go2Income help you manage your retirement? I promise it will be almost as easy as handing over your money to a corporate pension manager.
