Jerry Golden on Retirement

Create a plan for pension-like retirement income

March 16, 2016 By Jerry Golden in Annuity, Social Security 7 Comments Tags: Annuities, Guaranteed Income, retirement income, Social Security

A generation ago, retirees could rely on workplace pensions, along with Social Security payments, to provide guaranteed income that would meet most, or perhaps all, of their living expenses.

That doesn’t happen anymore. When you plan your retirement, you must take responsibility yourself to create a pension substitute from a mix of options that you can combine and customize to meet your needs. Often advisors unfortunately limit those options to investments like stock and bond mutual funds – combined with a “withdraw until it runs out” strategy. That’s very far from a pension. More

Predicting the future of retirement

March 11, 2016 By Jerry Golden in Annuity Tags: Annuities, Guaranteed Income, retirement, retirement income

A radio show I heard recently referred to an observation from the author Kurt Vonnegut, who long ago suggested that the U.S. government create a new cabinet post called “Secretary of the Future.”

The czar would predict what the country needs to do to prepare for 20 to 50 years out. The show’s host asked the audience for topics that would most likely contribute to the country’s health.

Christian Schnettelker - Flickr — Photo Credit: Christian Schnettelker/Flickr

Maximize tax benefits: Die broke in one investment account and rich in another

March 8, 2016 By Jerry Golden in Annuity 1 Comment Tags: Annuities, Dependable spendable income, Guaranteed Income, retirement income

Everyone’s goal is to pay as few taxes as possible, but when planning for retirement many investors and even their advisors neglect a basic concept:

Die broke in your IRA or 401(k) account and
die rich in your personal investment account.

The tax rules dictate where to die broke and where to die rich. With a little planning and asset management, anyone can do it. Instead of fighting the tax code, take advantage of it by putting each of your retirement investments – stocks, bonds or income annuities – in the account that benefits you most.

With smart allocations, you will realize potentially huge gains. More

Lifestyle changes raise the question: rent or buy?

March 1, 2016 By Jerry Golden in Annuity, Social Security 2 Comments Tags: Dependable spendable income, retirement, Social Security

Sarah loves the house she has lived in for 35 years. She and her husband bought it together and after the couple divorced, Sarah raised her two daughters there. The years have passed quickly and at the age of 72 she wants to downsize. Happily her girls still live nearby with their families so she is going to stay in the area.

Now Sarah is tackling the classic question:

Should she rent or buy her next home?

Sarah will have to consider how her money will serve her better. Can she sell her house and buy another for a lower price, which would help her finance the rest of her living expenses? Or would renting free up more of her capital?
More

Plan for a two-stage retirement to avoid running out of money

February 23, 2016 By Jerry Golden in Annuity 7 Comments Tags: Dependable spendable income, Guaranteed Income, retirement

One flaw with traditional retirement planning is the assumption that your expenses – the type and amount — will be the same (plus inflation) each year, from your final day at work to the end of your life, and that all you have to do is “replace a percentage of your pre-retirement income.” As people live longer, we have proof that isn’t true. Healthcare costs, especially, increase in our late retirement years, and if we don’t plan for them, we risk running out of money.

The solution is to consider retirement as a two-stage process. In the first stage, you do want to cover a reasonable percentage of the final salary you earned before retiring, although the percentage may need to be more than 100%. Your Social Security payments, any pension, interest/dividends and payments from income annuities ideally will cover that. If you need to withdraw principal, make sure it’s for a temporary period and from a secure source.

For the second stage, you will want to maintain those payments to meet your essential living expenses – and add another level of income to cover the gap for things like home healthcare and additional costs that occur as we age. More