Retirement Income Planning?...Watch Wealthtrack
I watched this show last week and highly recommend anyone needing to start generating income from their IRA or 401k tune in. WealthTrack's host Consuelo Mack had Jonathan Clements and several other financial planners discuss annuity and distribution strategies. They have the show and transcript available on their site.
Retirement Income Special on WealthTrack. (WealthTrack is on Friday night. Check your local listing)
76 million baby boomers will retire over the next two decades, and many of them will be facing a new financial challenge- how to fill what is being called the "guaranteed income gap." Guaranteed income is income you cannot outlive, like social security and traditional pensions. But those pensions, or defined benefit plans, are becoming rarer. In 1979, 84% of American workers were covered by a traditional pension. By 2005, that figure was down to 37% and dropping fast. That means that most Americans must face some complicated decisions about how to invest and distribute their life savings to provide an income stream for the rest of their lives.
There are variable annuity programs out there where you are invested in the stock market, you can stay fully invested in equities, which have been the best hedge against inflation, but will have a guaranteed lifetime income that even if you ran out of money- if you put in $100,000 and you are drawing out $6,000 a year and you run out of money, and you’re 10, 11 or 12, and there’s $1,000 left in the account- the insurance company will pay you an immediate annuity on the $100,000 that doesn't exist any more, and that will cover your income stream for the rest of your life, even though you’re investment portfolio failed.
Wise Owl