What New Retirees Wish They Had Thought About 20 Years Ago
Will there be enough income from your savings to cover living expenses?
Did you know you can have risk-free growth before and after you retire?
Is Following the Herd The Best Way To Go?
Below is a comparison of savings prior to retirement for a tax-deferred IRA/401(k) vs a Hybrid Plan
Interest Rates used for each plan(Line 13 – S&P/Historical) are based on actual returns
Hybrid ‘Monthly $’ (Line 11) are after-tax contributions
Hybrid #1switches to Hybrid #2 in year 4, with $3,432 surplus for expenses
Note that the IRA plan has about $200,000 more at retirement
Post retirement begins after 20 years of saving
Despite starting with $200K more, the IRA/401(k) plan yields less than ½ the income
Once retirement begins, IRA returns go to 5-6% range to avoid loss of capital
Hybrid plan has always been risk free with an 11% return
Footnotes
- Hybrid returns shown are conservative compared to actual returns
- Tax rates used are 5% less during retirement (what if they’re higher?)
- Returns shown for Hybrid are net (after expenses)
- Expenses for IRA are normally 0.5% – 1% per year of account balance
Conventional financial planning focuses primarily
on accumulating savings before retirement
An effective plan for investing should provide enough income
for the retiree to maintain their lifestyle during retirement years
What kind of plan do you have?
Take this opportunity to learn the same strategies wealthy families have been using for decades to create tax-free generational wealth
You don’t need a large down payment to begin
Spend a few minutes exchanging emails to learn the how and the who, and get an estimate of your own retirement income potential
“If you don’t know where you are going, you might wind up someplace else.”
Yogi Berra