Jerry Golden on Retirement

Announcing Go2Income and My Return to Blogging

July 25, 2014 By Jerry Golden in Annuity Tags: Go2Income, Retirement Income Annuity, Retirement Income Experts, Retirement Planning

Pardon my brief hiatus from delivering observations from the world of retirement, but along with the rest of my team, over the past few months I have been working on a project we believe is of immense value to investors like yourself.

That is why I am proud to announce Go2Income.

Go2Income is a new service that Golden Retirement, LLC developed to help individual investors (1) decide whether a Retirement Income Annuity makes sense for them; (2) select the type of annuity options that fits their personal circumstances; and (3) choose the insurance company with the best rates and rating.

Letter to the Editor – We’ll All Rethink Our Retirement One Way or Another

April 4, 2014 By Jerry Golden in Interesting Articles, Social Security Tags: retirement, Social Security, Social Security Beneficiaries, Social Security Benefits, Social Security Reform, Wall Street Journal

Last month, the Wall Street Journal’s Letters to the Editor was on the topic of retirement.

The letter was titled: “We’ll All Rethink Our Retirement One Way or Another”.

Among several scholars, industry experts and other opinionated people with well articulated arguments, I submitted a proposal, which was published in the Wall Street Journal on March 17. Below is my submission, which argues that with added flexibility to Social Security, we could in turn save billions of dollars in the process.

Along with greater work flexibility, America needs to offer retirees greater flexibility for their Social Security benefit choices by allowing Social Security beneficiaries to delay starting benefits beyond age 70, and to gradually opt into Social Security benefits as part of a “staged” retirement.

In the process, according to my analysis, $200 billion to $400 billion in Social Security outlays could be saved over the next 20 years.

The pitfalls of our Social Security system don’t have to be as dire as they’ve been constructed. A little flexibility can go a long way.

A Lack Of Definition Leads To A Lack Of Understanding

January 17, 2014 By Jerry Golden in Annuity Tags: Annuities, Deferred variable annuity, Fixed payout annuity, Indexed annuity, retirement

In keeping up with the daily articles and posts about retirement, I have noticed discrepancies in the use of the term “annuity”, which has developed into a point of contention. This inconsistency in a clear definition of annuities has plagued these articles, which in turn hurts the reader, the writer and the annuity business.

A recent example of this growing problem arose a few days ago while I was comparing two retirement advice articles from two different sources. In Lisa Hay’s recent article from Market Watch, titled 6 Money Mistakes To Avoid In Retirement, her second warning is “not to fall for an annuity sales pitch”; while in Steve Vernon’s article titled, How Long Will Your Retire Savings Last, from CBS Money Watch, he states, “one way to avoid running out of money before you die is to buy an annuity from an insurance company.”

Do these two writers disagree about the efficacy of a single type of annuity, as the lay reader would assume? No, in fact they’re referring to two totally different forms of annuity.

New Year’s Wishes for Retirement Regulations

January 8, 2014 By Jerry Golden in Interesting Articles, Social Security Tags: IRA, retirement, Rollover IRA, Social Security, Social Security Reform

The start of the New Year signifies a time of change in our lives, where we resolve to better ourselves after the knowledge and experience gained from the previous one.. Apart from the resolutions of self-betterment that we all seem to make, I would hope to see changes to retirement related laws and regulations, which could benefit us all.

Due to more pressing matters in Washington; I do not foresee any specific reforms to retirement, unless it is part of a “grand bargain” that addresses long term debt and fiscal issues. However, there are several changes that I would like to see, which could ultimately better the current state of retirement.

Reform Social Security that would take long term financing issues off the table. There are many reasonable approaches that could work, including my proposal of updating Social Security to the new realities of older American workers.
Change the taxation of income annuities to encourage middle market retirees to reduce investment risk and increase cash flow by electing lifetime payouts.
Limit the excessive accumulation in Rollover IRA’s. Require faster and earlier distribution rather than restricting the types of investment or contributions.
Improve the disclosure for complex annuity products. Requires better coordination between State insurance and Federal securities regulators.
Define the fiduciary responsibility of anyone advising investors regarding retirement matters.

Whether or not these changes will come to fruition in 2014, I believe these five alterations to retirement laws and regulations could largely benefit any current or future retirees.

On behalf of the Golden Retirement team, we would like to wish you all a safe and happy New Year.

Social Security Reform – Solving the Annuity Puzzle

December 28, 2011 By Jerry Golden in Interesting Articles, Social Security

In my Op-ed published on December 8 by Bloomberg News (at http://bloom.bg/v2UCRq ), I suggested that the Social Security System could be made financially stronger while giving Social Security beneficiaries more choices about how and when their benefits are distributed.

In last week’s blog I outlined the advantages of a strategy of staging the election of Social Security benefits.

To realize those advantages, we may have to solve a puzzle that, if not one for the ages, has caused academics and marketers to scratch their collective heads – why don’t more individuals elect lifetime annuities.

Well, the same issues apply to Social Security in its current form, as well as under the reforms I am proposing. Rather than being a question of whether or not to purchase a lifetime annuity with personal retirement savings, the Social Security decision is whether or not to delay election even when any such deferred payment has a fair market-based adjustment to the current payment available. In both cases the individual is exchanging the current value for a future value fairly determined.

Of course, there are any numbers of reasons, rational or not, for Social Security beneficiaries not to defer: (1) they absolutely need 100% of their Social Security payments to meet current expenses, or (2) they have no faith in the future of Social Security. However, current experience suggests that beneficiaries are electing Social Security earlier for the same reason that individuals don’t purchase lifetime annuities. It’s about somehow giving up the accrued value to the issuer (life insurance company or Social Security) at death before they “break even”.

In both of these instances, individuals for the most part don’t “get” the concept of risk pooling for lifetime annuity payments, while they do get it for life insurance, health insurance, and property and casualty insurance.

My proposed Social Security reform would address this puzzle by permitting beneficiaries to stage deferrals, elect survivor benefits, and select caregiver benefits – all on a fair market value basis.

Bottom line, rather than focusing on the same pieces in the puzzle over and over again, changing the offering would give individual beneficiaries more choices.

The same can be said for commercial payout annuities – there are a wide range of annuities that can help solve the retirement puzzle so many individuals now face. We just need to better educate the public and offer greater annuity flexibility to improve retirees’income plans.

Jerry Golden
CEO, GoldenRetirement.com
Social Security reform that benefits retirees.