Retirement savings need time to grow. Your investment objective is two fold: grow AND protect.

The strategy does that for you. And it does it for you while you are retired.

The most important takeaway is the importance of starting to prepare for retirement as soon as possible.

There’s a lot more to financial planning than just managing your investments.

It’s important to have developed a comprehensive retirement road map that covers all bases, from revenue projections and tax savings to health-care preparation and estate planning.

Everyone’s retirement schedule, needs, and plans are different. However, due to factors such as Social Security, Medicare, and IRS regulations, almost all will face retirement planning challenges in about the same order.

Your retirement road map can be broken down into stages.

AGES: 40-61. The need to accumulate assets and avoid unnecessary risk and loss.

AGES: 62-70. When Social Security and Medicare kick-in, it is considered early retirement. It takes careful thought and preparation to determine the best times to participate in these programs.

AGES: 71-90+. Longevity comes at a price, especially in terms of health care. Smart retirement preparation entails making strategic withdrawals to ensure that you and/or your spouse will have enough money if you and/or your spouse live to be 90 years old. If you do, you’ll need a strategy to pay for any long-term care you might need.


Income in Retirement

A rational understanding of history and the factors that influence longer-term stock market returns will assist today’s retiree in avoiding a “surprise.”

With a systematic withdrawal rate of 4% on $1,000,000, the benefits are proportional to the starting level of the valuation of stocks.

While the overall success rate is 95%, today’s retiree starting with a P/E greater than 18.5 has an estimated success rate of less than 80%.

A retiree could request a 5% withdrawal rate that would last 30 years.

The rate of withdrawal has a measured success rate of 73 percent.

This is an example of how the starting valuation has a big impact on future results.


To learn about a prudent approach to retirement income, read the following: