This week I'm starting a four-part series called "Don't Run Out Of Money". This week will be talking about the fundamental risk in running out of money in retirement which is the "Sequence of Return" risk. If you're not familiar with this, I encourage you to watch the following video which illustrates the tale of two portfolios, one which runs out of money before retirement end [embedyt] https://www.youtube.com/watch?v=y4u2GCmRgtE[/embedyt] … [Read more...]
The New Social Security Rules (Post 2015)
The year 2015 brought about significant changes to the Social Security system through the Bipartisan Budget Act. In typical political style, each side of the aisle negotiated to have desired law and rule changes implemented by mutually conceding items to the other side. Some lawmakers felt that there was a loophole in the Social Security system that needed to be closed regarding ways to maximize Social Security that were not originally intended. … [Read more...]
A Common Risk Retirees Miss
Some retirement risks are clear….long term care potential, running out of money, aging and the diminished capacity to make decisions...and so on. In today’s video blog, we tackle a risk that affects every retiree that many aren’t even aware of: … [Read more...]
The best investments to use for your 401k and 403b
According to the Employee Benefit Research Institute, 76% of workers offered a 401(k) or similar retirement plan at work contribute to the plan. That makes it one of the most common ways that we save for retirement, especially if there are matching contributions offered by the employer. There are great benefits to these tax-deductible contributions and matches inside of company retirement plans, but there are also some frustrations that go along with them. One of the biggest drawbacks of … [Read more...]
The negative impact of Social Security benefits on other family members
A common question that I get regarding claiming Social Security benefits has to do with the potential negative impact of claiming a benefit on either a spouse, divorced spouse, or even their own future benefit. In today's article, let's discuss when claiming a Social Security benefit could negatively impact another benefit. … [Read more...]
Help Your Money Last Longer in Retirement
This week's blog is via video using the link below: https://goo.gl/qPZFrf In it we talk about how to make retirement portfolios last longer by avoiding the sequence of return risk through the use of a standby reverse mortgage line of credit in down market years. It's based on solid academic research and I'm particularly excited about how it can help improve retirement outcomes. Here is the link to the Journal of Financial Planning article … [Read more...]
Step 6 of the Retirement Planning Process – Minimize Tax Liability
Step 6 of of the Retirement Planning Process is “Minimize the Tax Liability”. I haven't met a retiree recently who is told me that they think that tax rates will be going down in the future. With trillions of dollars of debt and unfunded liabilities in the future, it's important to control the amount of taxes that will be paid on IRA distributions, since it is very likely that future tax rates will increase. If you're curious about the state of the current national debt and … [Read more...]
Step 5 of the Retirement Planning Process – Manage Risk
I hope that you enjoyed the series on the steps to retirement planning so far. In this installment we will deal with Step 5: STEP 5 – Manage or Eliminate Retirement Risk We want to make sure the right kinds and amounts of insurance and risk management strategies are in place to effectively deal with the most sinister of retirement risks which could derail our plan. This includes the premature death of a spouse, unexpected long-term care costs, and a major … [Read more...]
Step 4 of the Financial Planning Process
Step 4 of the Retirement Planning Process is to set up an effective cash flow management system. A retirement plan blueprint is built upon a projected amount of investment account withdrawals each year. If retirees withdraw more than the projected amount due to cash flow mismanagement, it puts the longevity of the investment portfolio in jeopardy. … [Read more...]
What is the sequence of return risk in retirement?
Entering into retirement isn't for the faint of heart. David Littell from The American College has identified 18 risks that retirees face which must be mitigated for a successful retirement. He lists the following: … [Read more...]
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