Retirement Income for people who don’t have a big pension

It used to be back in the “Good Ol Days” that you worked for a company for 40 years, then you retired.

They threw you a party,  you got some cake, a gold watch and … A PENSION.

Talk about security. Every month you walk out to the mailbox and there’s a check.

Unfortunately, that’s all but gone now for most people.

Employers switched from Pension type programs to 401k type programs and put the responsibility on you to figure it out your retirement income.

So this has created a problem.

More and more Americans are approaching retirement and they won’t have enough guaranteed retirement coming in to meet their income requirements.

So…they will rely on whatever they saved up in their IRA-401k to fill in the gaps.

The interesting thing is…

  • People LOVE their Social Security income.
  • People LOVE their pension income (if they get one)

In fact they would love it, if Social Security alone, was enough income to meet all their bills.

But for most of us,  it won’t be enough. We’ll need more income than that.

Why do people like their Social Security or Pension Income so much?

  • In theory. It’s a guaranteed source of income.
  • It’s steady and dependable
  • It’s not affected by the stock market or interest rates
  • It helps to create a budget and plan for the future
  • It gives a sense of security

So here’s the million dollar question.

If you will need income from your IRA-401k.

Why not set it up to be like Social Security or a Pension where the income is:

  • Guaranteed
  • Steady and dependable
  • Not affected by the stock market or interest rates

If you wouldn’t want your Social Security or Pension income to be based on the ups and downs of the stock market…

Why would you want this additional income to be?

Think about it as 3 buckets of money.

  1. Security and Income
  2. Growth With Risk
  3. Spend and Enjoy Now

It’s OK to have some of your money at risk.

It’s OK to have some of your money to spend now, on bills or vacation or whatever.

It’s also important to have some of your money set aside for income that is safe and guaranteed.

You need all 3.

So if you are looking to set up a “Personal Pension” for yourself to meet your income needs in retirement, how do you do it?

This is what annuities are designed to do. They go back to the Julius Caesar days.

The newer type of annuity is known as the Hybrid Annuity.

Insurance companies came out with this product because in the old days, the income products (annuities) were irrevocable.

You gave the insurance company your money. And in exchange they gave you payments for life.  Your money was gone. But you got payments.

You couldn’t change your mind.

Things have changed a lot since then.

Now you can get guaranteed income for as long as you live and stay in control of your money in case your need change down the road.

  • Your principal is safe from market losses
  • You know exactly how much income you will get in 3,5,7,10 years or whenever you retire
  • You know that income is contractually guaranteed to come in every month no matter what happens in the economy
  • You know that income is guaranteed for as long as you live or as long you and your spouse live
  • If you die early and there’s a balance left, it will go to the kids

Pretty simple. That what a lot of people want.

You can’t get that from mutual funds.

If you’d like a little more info on creating a “Personal Pension” for yourself you might find this helpful. It’s an 8 minute video called “Paycheck For Life” and a place you can request a quote.

Copyright: stockbroker / 123RF Stock Photo




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