What is the 360° Retirement Game Plan?

A holistic financial review looks at your financial situation in a different way — it considers how insurance products and other financial vehicles may have been overlooked or inadequately addressed. In addition to these facets, we will also examine your rate of return alongside your risk and reward analysis, with all of these aspects culminating into your retirement strategy.  At MWA we will examine all aspects of your retirement—income, taxes, trusts and estates — to help you prepare for your ideal retirement lifestyle.

Crafting a retirement game plan is dependent on you and your financial needs. When it comes to retirement income strategies, you have a few options for generating an income. These strategies depend on three things: how much money you’ve saved, how much money you’re going to need and how long you need that money to last for.

Before sitting down to plan, it is important to keep a few things in mind.

  1. Plan for a long retirement. You don’t want to be left income-less because you didn’t plan well. 
  2. Be flexible with market volatility. The market shifts and this can be worrisome when all of your saved money is in it. Be prepared!
  3. Make sure you don’t withdraw too much money from your savings account because the last thing you want is to run out of money during your retirement.

Here are three strategies for generating an income and securing your finances during your retirement.

Interest And Dividends Only

You can fund your retirement from the interest and dividends generated from your savings. If you go this route, withdraw principal only if necessary. This approach is simple, straightforward and easy to manage. However, it does require a big portfolio – about 30 times the amount of your first-year withdrawal. It also doesn’t take inflation into account, which will affect your spending habits throughout your long retirement.

How it works:

  • Invest retirement savings into investments that will generate an income. Utilize bond sectors and maturities to manage your income.
  • To counteract inflation’s impact over time, it is best practice to invest your portfolio into stock investments that have large potential growths. There might be a little risk accompanied, but if you’re looking for a long retirement, this is the way to go.
  • Draw from investment principal only if needed. In this strategy, you can withdraw interest and dividends as they generate.

Investment Portfolio – Total Returns

With this income strategy, you are able to draw income from the interest earnings of your investments. You can pace your earnings with withdrawals from your principal. This strategy is great because you can generate an income which has the potential of growth. You might not be able to cover all your expenses with the interest and dividends from investments, so combining that with principal withdrawals is ideal.

How it works:

  • According to an asset allocation plan, you’ll invest retirement savings that reflect your time horizon, risk comfortability and other income goals.
  • Withdraw investment earnings and proceeds from selling investments at a set rate, starting at 4 percent of your portfolio’s value from the first retirement year which will give you a high probability of keeping at that withdrawal level for 30 years.
  • To keep up with inflation rates, increase your withdrawals each year.

Total Return With Annuity – Investment Portfolio With Guarantees

An annuity is a long-term investment with an insurance contract that ensures a stream of income. Annuity income can be guaranteed for life, so this approach is ideal to supplement with investment income. You will feel more comfortable about investing from your portfolio into higher-risk, higher-return investments because you’ll know a portion of your expenses will be covered by your set income.

How it works:

  • Purchase an annuity with your retirement savings. You’ll receive a set income over a set period of time.
  • Invest the remaining of your retirement portfolio into a variety of income/growth investments that will provide you with an income, depending on the health of the market.

Now that you have the general gist of retirement income strategies, it’s time to get started on yours. On your mark, get set, GO!