Retirement looks and feels different for each of us. Some of us dream of walking away from work completely to live a carefree life such as spending more time with family or volunteering with a local non-profit. Others imagine leaving the day-to-day grind to work a more flexible part-time schedule which allows more time for personal pursuits such as fun trips close to home and abroad. With the stresses of paying a mortgage and putting children through school behind, some even fulfill the lifelong goal of starting a small business, going back to school or writing a book. Each retirement plan is as unique as the individual who dreams it.
Making Preparations.
For the entirety of a career, our investors have been receiving a paycheck. Stepping away from employment means that paycheck won't show up on the first of the month. That's an unnerving feeling. We work hard to make the transition from work to retirement a comfortable one.
There is a belief that as an investor approaches retirement, they should shift their net worth entirely to a more conservative blend of investments. That is not entirely true. In the years leading up to retirement, we work towards a blend of strategies that protect against long term inflation while producing short term income to cover retirement cash flow needs.
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Inflation Protection
Together, we implement strategies that protect assets from the erosion of future inflation by utilizing asset classes that have history of outpacing inflation.
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Guaranteed Income
Guaranteed income provides consistency and reliability in planning. This type of pension income is less common. However, in our cash flow planning we work with the tools available to create reliable income sources.
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Making Income Last
Utilizing a very specific portfolio strategy for our sustainer clients, we are intentional in how we produce income from portfolios long before it is needed and in the most tax efficient way possible.
Tiered Asset Management in Retirement
Growth Strategy
This account is managed towards long term growth and inflation protection. When market is up, we may take gains from this account to fund cash flow needs. Gains could also be invested in the balanced account for additional diversification.
Balanced Strategy
This is a more conservative account, managed to provide income and weather some short term volatility. We may take income from this account when the market is both up and down to allow growth accounts to run in a bull market or rally back after a bear market.
Cash and Equivalents
We take profits out of growth and balanced strategies to fund the cash account. This account pays out monthly income, as needed. Assets should be relatively liquid and sheltered from traditional market volatility.