According to Gallup poll statistics, approximately 59 percent of the US population worries about their retirement income. For the 30 to 49 age group, 70 percent state that their number-one financial concern is their future retirement income. With increased life expectancy, depending on a person’s age at retirement, many could reasonably expect to live 20 to 40 years as retirees. For a 65-year-old couple, one partner is likely to live to the age of 90. Those can be sobering statistics when planning for retirement.
With 24 years of experience, Myron Mitchell has consistently addressed these issues through coordinating and managing retirement assets for his clients. His clients understand that establishing informed and realistic goals goes a long way toward an enriching retirement.
“Our web page, mwmg.yournextphase.com is a good resource to access planning information and questions you may want to consider asking related to your retirement plan,” shared Myron. The site includes information on three of the biggest risks to retirement planning. When you consider companies are shifting the responsibility of retirement income onto the employee, through 401(k) and other plans, and moving rapidly away from pension plans, providing these resources is another step in helping people understand the process.
Three retirement income potential risks that need to be considered according to Myron are Timing, Inflation, and Longevity.
- Timing Risk: “One of the biggest challenges in retirement planning is not knowing if you are retiring at the beginning of a major market downturn or uptick,” Myron stated. “The timing of retirement can have a dramatic impact on how much money will be left. For example, if someone retired in October 2007 with $500,000 saved in a balanced (60% stock and 40% bond and cash) fund, 17 months later their savings would have decreased by roughly $200,000 or 38% without any withdrawals, simply due to the market downturn. Conversely, if the retirement date was March 2009, 17 months later their initial $500,000 investment, in the same balanced fund, would have increased by approximately 38% to $700,000, due to the market upturn.”
- Inflation Impact: In order to have the potential for your retirement income to keep up with inflation, developing a comprehensive, documented distribution plan is important. Mitchell Wealth Management Group, LLC employs academically based tools to formulate strategies to address inflation risks. This is an extremely important consideration, given that a loaf of bread cost $.52 in 1980 and $1.35 in January 2017 (according to the Bureau of Labor Statistics).
- Longevity: “Prior to retirement, most people define ROI as Return on Investment; however, after retirement, ROI becomes Reliability of Income,” explained Myron. With cost of healthcare, food and other necessary living expense continuing to rise, retirees want to plan for their savings to provide a standard of living that will keep pace with inflation through their retirement years. Mitchell Wealth Management Group, LLC uses modeling tools to illustrate expected monthly income based on clients’ goals and portfolio. The models can be revised during appointments to allow for discussion and illustration. One of the most frequent questions asked, according to Myron, is “How much income can I have when I retire?” These tools can help answer this question.
Mitchell Wealth Management Group, LLC offers other options to their clients. Investment portfolio management; long-term care insurance; life insurance; strategic financial planning; inflation-adjusted, lifetime income distribution strategies are among additional opportunities available.
Mitchell Wealth Management Group, LLC is located at 514 South Stratford Road, Suite 305. Contact them at 336.774.6535 to make an appointment, or visit their website, mitchellwealthmanagement.com.
Securities offered through Securities America, Inc., Member FINRA/SIPC, Myron D. Mitchell Registered Representative. Advisory services offered through Securities America Advisors, Inc., Mitchell Wealth Management Group, LLC, and the Securities America companies are separate entities.