ARTICLES OF INTEREST FROM JANUARY 2020

How to Turn Your Nest Egg Into Steady Payments

January 30, 2020

Many Americans look with longing at old-fashioned pension plans, which cover a dwindling share of the workforce. After all, aside from providing a guaranteed monthly paycheck for life, pensions spare retirees the hassle and anxiety of figuring out how to make their nest eggs last. Now the retirement paycheck is staging a comeback—inside the 401(k). As baby boomers retire and withdraw their nest eggs, 401(k) plans are losing assets. Employers are adding income-producing investments and services to plans in part to persuade older workers—who tend to have the largest balances—to keep their money in the 401(k) rather than move it to an individual retirement account.

The Stunning Problem With The 4% Retirement Income Rule In One Chart

January 22, 2020

Are you in the “retirement bubble”? The retirement bubble is the few years leading up to retirement and the first few years in retirement when your retirement nest egg is most vulnerable to market shocks. Why? It is because of sequence of investment returns risk. Sequence of investment returns is most dangerous when you are withdrawing money from your portfolio, which is exactly what most retirees need to do in retirement.

January 3, 2020

he market tanks in the early years of your retirement, you could be in big trouble … unless you’re prepared. Sequence of return risk, in my opinion, may be the biggest risk retirees face. So, what is sequence of returns? It’s the order in which you get the returns that your investments receive. Why is this so important? Before retirement, it doesn’t matter what order your returns come in. The end result is the exact same number. But look at what happens when I take withdrawals from the accounts in the example below.

You are leaving The Independent Excellence Group and going to a third-party site. The Independent Excellence Group does not own or control the information on these third-party sites and can make no representation as to its accuracy or currency.