Income allocation Archives - Page 6 of 7 - Jerry Golden on Retirement

We need a few good retirees!

September 14, 2018 By Jerry Golden in Income Allocation Tags: Income allocation, Jerry Golden, retirement income

We are about to add the first of a series of new income planning tools to the Go2Income.com site. It will allow retirees to design an income allocation plan tailored to their personal circumstances.

I have been writing about income allocation for a while. This approach changes the retirement planning paradigm and addresses your need to create more income with less market risk. For the rest of your retirement.

Income allocation is a different approach than you will hear from most financial advisers. They talk about asset allocation, which places your savings in different buckets – stocks, bonds, etc. – from which you can withdraw money until you reach a certain age. If you live longer than that, you have to talk to the kids about moving in with them.

With income allocation, you decide now how to generate your income from investments and from income annuities. The income annuities are important because they offer guaranteed income for the rest of your life. As I wrote here, an income allocation plan also enables you to allocate a smaller amount to higher-risk withdrawals. In fact, you may be more likely to stay the course when you know a check will be deposited into your bank account every month.

Help us help others

We are inviting you to learn about the planning method while it is still part of what we call a “beta release.” You can test it before it’s available to the general public. Register here if you’d like to participate in this test.

After reviewing the income allocation educational materials and tool on the Go2Income site, we would greatly appreciate if you take a few minutes to complete a brief survey at the bottom of Income Allocation/Step 3.

We will use your feedback to improve the tool and educational support, as well as helping us design other Income Planning tools we add to Go2Income after that.

A helpful income allocation plan

We are hoping to learn whether our site does a good job of explaining income allocation. What changes should we make to the educational materials? Are the tools and results clear? Does income allocation make sense to our subscribers?

With your help, retirement will be changed forever.

How to boost retirement income by making it safer

September 4, 2018 By Jerry Golden in Income Allocation Tags: boost retirement income, Income allocation, retirement income, safer income

One of my Baby Boomer clients asked for help with a retirement plan that would provide her with a specified level of “safe income” every month. She understood that she did not have enough savings to live off interest on U.S. Treasury bonds or savings accounts. Very few of my clients have accumulated that much in savings. So, she was looking for other, higher-yielding sources of safe income.

I agreed to work with her, but first we had to agree on what “safe” means. Then we had to decide the meaning of “income.” Once we both accepted those two definitions, the plan was relatively easy.

Nothing is 100% “safe.” Even Social Security may require reform and some pension plans may need a bailout. And some sources of income that retirees count on from their savings depend on market performance, and therefore are riskier. But if you consider probabilities, the “guaranteed and lifetime” income sources below are both safe and will last a lifetime.

Earn up to 20% more in retirement with income allocation

June 19, 2018 By Jerry Golden in Annuity Tags: Annuities, Dependable spendable income, Guaranteed Income, Income allocation, retirement income

Income will determine whether your retirement is financially successful.

When you have enough income, you feel more secure. You worry less. You can spend more time doing what you want with people whose company you enjoy.

And from an investment perspective, you’re more likely to “stay the course” and not jump out of the market.

A new study shows how an income allocation strategy beats the traditional strategy of asset allocation, and delivers that additional income with less risk. Here’s a good description of the income allocation strategy.

The study examines different risk profiles for a 70-year-old male or female who, over the rest of their lives, will generate more income, lower volatility and a higher economic return when an income allocation strategy is implemented. Implementation for your age and risk profile will need to be customized, of course, to your personal circumstances.

For a free, no-obligation copy of my income allocation study, send a request to Ask Jerry.

Do you have enough income to retire?

March 13, 2018 By Jerry Golden in Income Allocation 5 Comments Tags: Annuities, Dependable spendable income, Guaranteed Income, Income allocation, retirement income

Part III – Study confirms more income with less volatility

In Parts I and II in this series, I suggested that you could receive more retirement income with less volatility if you and your advisor moved from asset allocation to income allocation. It’s one thing to suggest and another thing to prove. So we conducted a study and will publish the full results and the underlying methodology in the next few weeks. As you will see, there are dramatic advantages to focusing on income allocation.

For this article we selected one of the case studies (a male 70, who has $1 million in retirement savings, 50% in a rollover IRA) with a current asset allocation of 30% to equities based on the “100 minus age” rule of thumb, and 70% to bonds and CDs. We compared that case to an income allocation strategy. You will see the results throughout this article, including a table of detailed results at the end of this article. Here are some highlights for this case:

Pre-tax income is increased by 32% over the investor’s lifetime.
Income volatility is reduced from 72% to 29%.

Do you have enough income to retire?

February 28, 2018 By Jerry Golden in Income Allocation 2 Comments Tags: Income allocation, Income annuities, Income power, retirement income

Part II: Income planning starts with income allocation

As a famous TV sports reporter would say, “Let’s go to the videotape!” When the talking is done, it’s always good to look again at the results to find out who won the race and why they won.

Unfortunately, most “experts” often view the wrong race. In the case of your retirement, many advisors will tell you that in this race against time you win when you hit a magic savings number. When we go to the videotape (or in our case an Excel spreadsheet), we realize that isn’t the correct focus. Instead, we should be asking, “Do I have enough income to retire?”