We speak a lot about annuities and are often asked to describe the type of person who benefits from owning one. In responding, we often say they benefit both “the Builder” and “the Protector”. A Builder can be described as the person nearing retirement, concerned about risk exposure, and someone wanting growth opportunities. A Protector can be described as the person entering retirement, wanting supplemental income, and looking for flexibility. So we ask you, are you a Builder or a Protector? Call us, we’re always here to help explain more about options that will help you fulfill your goals regardless of where you are in your retirement planning.
The approach to retirement is a balancing act between growing and protecting assets. In general, the closer we get to taking retirement income, the more the balance tends to shift toward protecting years of hard-earned dollars. That balance may be more relevant now than ever. Call us if you’d like to discuss what options you have where your principal is protected and your risk is lower. We’re always here to help.
We’re being told the reopening process is being done with “tremendous gusto and vigor,” but have we forgotten how to join in and left our gusto by the wayside? The dictionary tells us that we can do many things with gusto, or hearty enthusiasm, whether it’s playing a game or cheering someone on. Since the 17th century gusto has been helping speakers describe things that are done with vigor and enthusiasm. The doors are opening, slowly but surely. Maybe it’s time to go out and eat a steak with ‘gusto’ and get the flavor of life back again.
I, like most of you, become very discouraged when I look at the number of unemployed workers, especially because I know that the older we are, the less likely we will be rehired. As this week’s article reminds us, “if older workers cannot get rehired, they start to drain their savings sooner than expected and claim Social Security benefits a lot sooner than they wanted. And we know what that means.” “Collecting Social Security at age 62 instead of full retirement age reduces lifelong benefits by over 30%.” There are things you can do to maneuver through the crisis. Call us, we’re always here to help and we have some ideas you may not have thought about.
This week’s article about retiring is written by a psychologist who has researched perception and applied that knowledge to financial situations. The author tells us “By the time most of us reach retirement age, we feel as if we don’t have enough money to live the life we envisioned. Our feelings aren’t wrong.” Before COVID, the reasoning was that “so many of us start to prioritize retirement savings too late in life.” Now, another reason has been added with is that we may have lost enough of our retirement portfolio that even were we planned well, it still isn’t enough. We have some ideas to help, call us to learn about how to use some of your savings to get an income you can’t outlive.
We can’t control the impact Covid-19 has had on our savings, so maybe it’s time to come up with a plan and move forward. Yahoo finance shows us that the stock market is down 20% to 30% from the beginning of the year. The bond market is flat or down and not offsetting the stock market losses. The yield on the 10-year Treasuries has been below 1% for weeks. If we apply all of this to a typical IRA or other retirement account, most likely the losses are more than 15%. This means that whatever percentage you were planning on withdrawing in your retirement either has to decrease, or what you end up with is less. Either way we need to talk. It’s time to come up with a plan on plugging that hole. Call us, we have some ideas.
We’ve always told you that we are here to help. That means in connection with choosing retirement savings options that make you feel good about your future. But that also means to provide assistance in any way we can while you are staying at home. Need help with something? Call us, we are here for you.
You don’t have the Virus but your losses are still huge
We are receiving calls from clients fearful that their market losses are going to require them to claim social security benefits years earlier than they had otherwise planned. This has an impact on their long term income [i.e. the sooner you collect, the lower the amount monthly], but there are ways to supplement that lower income stream using savings you still have. Call us if you’d like more information on the new Covid-assistance bill that permits you to withdraw funds from some types of retirement accounts that prohibit you from purchasing an Annuity that would provide you with an income stream you can’t outlive, and moving those funds to a different retirement account where you can make that purchase. Call us if you’d like more information on this. We’re always here to help.
With all that is going on in the market with the Coronavirus, we have received many requests to give our opinion on how long it will take for a retirement savings to get back to the level it was before the virus took its toll on the market. Understanding that no one can predict what kind of return anyone is receiving on their savings, and knowing that returns are always investor specific, what we can do is provide you below with the mathematical formula for you to apply to your own situation, and under your own assumptions.
Concerned you’d need too many years? Call us. Maybe it’s time to protect a portion of what is left of your retirement savings from more loss. We have some ideas that you may want to know about.