Safeguarding Your Retirement

What is the No.1 concern for most pre-retirees and retirees?

by Ronald Stevenson and Barbara Clark Stevenson

Baby boomers are retiring at astonishing rates and are looking for ways to replace their steady paycheck. They are worried about the potential of Social Security diminishing and what might happen to their retirement if it does. At American Financial Security, we believe the No. 1 concern for most pre-retirees and retirees is outliving their money. It is important to safeguard your retirement so you do not have to worry about outliving your retirement income.

There are various ways we help our clients work toward safeguarding their retirement. First, we like to encourage clients to revisit their retirement plan. People who planned their retirement years ago think that what they decided on then is still applicable to their situation now. However, situations change, and we believe it is important to always check on your retirement plan to make sure it meets your current and/or new needs.

The next step is to determine what your daily income entails by first knowing how much you need and when you need it. A general rule of thumb is that a retiree will require 70 to 80 percent of their pre-retirement income to maintain their current lifestyle. Once you figure out what amount you will need and when, the next step would be to find beneficial investment strategies, options and tools to help you achieve your income goals.

There are a handful of ways to fill your need for income in retirement. Social Security is one of the better-known ways. Social Security is the foundation of income planning for anyone who is about to retire and can be a reliable source of income. Having a solid understanding of your Social Security benefit can help safeguard your retirement by allowing you to make informed decisions that will allow you to maximize your benefit.

Another way we help clients is by sharing with them how they could benefit from a fixed-index annuity*. Fixed-index annuities are specifically designed to create income – either today or at some point in the future. When you place a lump sum into a fixed-index annuity, the plan can be custom designed to help provide you with the ongoing income you need, for as long as you need it.  A fixed-index annuity may be an invaluable component of your retirement plan, helping you to safeguard your assets and your future.

Is it very important to have a retirement plan addressing ways to have income for life in order to safeguard your retirement? Finding the most efficient and beneficial way to address this may impact your lifestyle, your asset accumulation, and your legacy planning after you retire.

*Annuities are designed to be long-term investments and frequently involve surrender charges. Early withdrawals may impact annuity cash values and death benefits. Taxes are payable upon withdrawal of funds.  An additional 10% IRS penalty may apply to withdrawals prior to age 59 ½. Annuities are not guaranteed by FDIC or any other governmental agency and are not deposits or other obligations of, or guaranteed or endorsed by any bank or savings association. With fixed annuities, both the money you invest and the interest paid out are guaranteed by the claims-paying ability of the insurer. Investors should consider the investment objectives and expenses of a fixed index annuity carefully before investing.