Planning Your Retirement

How much will your retirement cost?

A person retiring at age 65 could easily spend 25 years in retirement. As a general rule-of-thumb, you will need to generate somewhere between 60% and 90% of your pretax, gross income in retirement. That income must grow each year at the inflation rate if you want to maintain your preretirement life style in retirement. 

Where will that income come from?  

Social Security will help somewhat.  The problem is the more you make the less effective Social Security will be as a source of retirement income.  

How about your corporate pension?  

It seems like everyday I hear of another pension plan terminating its promise of delivering dependable retirement income to plan participants.  

That leaves savings.  

In a 25-year retirement, using reasonable assumptions, for every $1,000 of annual income you need that is not covered by Social Security or a pension, you will need about $25,575 of capital to support it.  In other words, if you need $100,000 per year of pretax income from savings, you will need a capital base of approximately 2.5 million dollars at retirement's door to support it.  For most people that is a big number. Building that level of wealth will require a comprehensive plan and the discipline to execute that plan over time.  

Here is how we can help:

Retirement Builder Program

Process Steps:

Cash Flow Review - quantify how much it costs to live for an average month in your life

Corporate Benefits Review - evaluate your employee benefits and corporate-sponsored capital accumulation vehicles such as retirement plans, deferred compensation, stock options, restricted shares, stock purchase plans, and insurance coverages

Pension Plan and Social Security Review - understand your options regarding Social Security, Medicare, and pension benefits (if any)

Retirement Needs Analysis - calculate your retirement income needs, capital accumulation requirements, and savings rate required to achieve your retirement goal

Personal Spending Plan - create a comprehensive spending plan designed to help you maximize the effectiveness of your financial resources so that you can save adequately for retirement and enjoy life

Risk Management Plan - employ appropriate risk management techniques and procedures to protect your wealth during your working years and into retirement

Investment Plan - create an Investment Policy Statement using the time-tested principles of Modern Portfolio Theory to optimize the risk / reward characteristics of your portfolio and also minimize fees and taxable events over time

Periodic Review Schedule - establish a periodic review schedule to help keep you focused and on track towards building sustainable wealth over time

When it's all said and done, you get the retirement you can afford, not necessarily the one you dream about. Schedule your free Retirement Builder consultation today. 


Click here to learn more about using Retirement Builder to plan the retirement of your dreams.