Retirement Planning

Retirement: What is Your Plan?

  • What percentage of your current income level will you require in your retirement years?
  • Who will be financially dependent on you in your retirement years (parents, children)?
  • At what age do you plan to retire?
  • How much do you currently contribute to your retirement plans?
  • How effective is the asset allocation model you are using for your retirement assets?
  • What will your retirement income look like if you or your spouse is alone (divorce, widowed)?
  • What legacy do you want to pass on to your loved ones?

A major portion of retirement planning is simply budgeting and future cash flow planning. A key step in this process is to prepare a retirement projection for the client (also called a capital needs analysis). This projection will serve as a road map guiding the client to and throughout retirement. This projection should be reviewed annually (or every two years at a minimum). It is very important to discuss the assumptions of investment rate of return, inflation and tax rates with the client and get agreement on these key assumptions. It is also helpful to run several retirement projections using different investment rates of return, inflation rates and tax rates.

Individual Plans:

  • IRAs
  • Non-qualified annuities

Employer Plans:

  • 401(k) plans
  • SEPs
  • Money purchase pension plans
  • Profit sharing plans
  • Employee stock ownership plans (ESOPs)
  • Defined benefit plans
  • 412(i) fully insured defined benefit plans
  • 403(b) plans

Post-Retirement Asset Allocation

Investment planning does not end after retirement. Rapidly rising life expectancies mandate that careful attention be paid to asset growth. With life expectancies now in the low eighties (and rising), and early retirements becoming more common, post retirement durations can easily exceed 25 years or more. Even with modest inflation of only 4% purchasing power could be reduced by more than 60%.

Maximize Payments from Defined Benefit Plans

IRA Rollovers