40-year-old with $275k Structured Settlement Wants Maximum Retirement Income at 60

(Don’t forget to checkout the video too)

Today’s case study is all about providing the absolute maximum retirement income in 20 years while taking on exactly 0 market risk.

This will be a 2-part approach to solving this problem using actual guarantees that currently exist in the insurance market.

Let’s get started.

⭐️ Here are the details ⭐️

✅ He is 40-years-old

✅ He wants to retire at age 60 with at least $5,000/month of guaranteed retirement income (that he can never outlive)

✅ He wants to grow this money with NO RISK of market loss

✅ He has $1900/month of guaranteed income coming from a structured settlement that he has been receiving for the past 20 years which will continue

✅ He will receive $275,000 lump-sum next month from his settlement that he wants to create MAXIMUM retirement income with

✅ He wants to retire tax-free (which we won’t analyze here, but I analyzed in this case study).

✅ He will take the guaranteed 8% per year growth to delay social security, maxing out his benefit at $3600/month at age 70.

⭐️ The Growth Strategy (ages 40–50) ⭐️

In the first 10 years, we will execute a growth strategy, aiming to maximize the growth of the account value without taking on any stock market risk.

There are 2 different approaches to can be taken to accomplish this, as outlined below:

✅ Option A: Put the $275,000 into a FIXED account, guaranteed at 5.35% per year for 10 years (no fees & no risk of loss).

✅ Option B: Put the $275,000 into an indexed, GROWTH account with a 10% upfront bonus and a cap rate of 7.75% per year (no fees, able to participate in the upside of the market with no risk of loss).

In Option B he will be able to participate in all of the growth of the market up to 7.75% (at 100% participation) but will have no possibility of losing money in any year, even if the market loses big.

Note: anything beyond 7.75% he will not be able to capture in this particular vehicle.

⭐️ The Growth Results ⭐️

✅ Option A: Will be worth a guaranteed value of $463,103.53 in 10 years

✅ Option B: Will be worth between a guaranteed value of $321,814 and maximum value of $580,103.50 (if the market does well) in the next 10 years.

As you can see, Option A offers a better guarantee, but Option B offers more potential upside.

It will be up to the client to decide which option makes the most sense for him.

⭐️ The Income Strategy (ages 50–60)⭐️

After the 10 year growth period, we will shift to an income strategy.

10 years from the date you anticipate taking income is the optimal timeframe to shift to an income strategy.

This approach is fairly simple.

I go out in the marketplace and find the highest, guaranteed income value at age 60 (meaning which company can contractually guaranteed the most income when the client wants it)!?

The only difference here will be which option the client had chose in the earlier stage (I will show both for comparison).

✅ Step 1— Reposition money from growth accounts into the highest, contractually guaranteed income vehicle.

✅ Step 2 — The highest paying income vehicle has been determined and the money will receive a 10% upfront credit when the funds are deposit & will earn a guaranteed 7% compounded rate of return for the next 10 years (all contractually guaranteed).

⭐️ The Income Results ⭐️

✅ Option A (from fixed account): Depositing the $463,103.53 from the fixed account will result in a guaranteed, income-for-life value of $59,023 at age 60 (that will last for as long as he lives).

✅ Option B (from indexed account): Depositing between $321,814 and $580,103.50 will result in guaranteed income values of between $41,016 and $73,935, respectively (and he can never outlive this income).

⭐️ Total Guaranteed Income at age 60⭐️

✅ $4,919/month from fixed account (if selected), OR

✅ Between $3,418/month and $6,161/month from the indexed account (if selected)

✅ $1,900/month continuing from settlement

TOTAL Guaranteed Income at age 60 = $6,819/month from fixed account OR between $5,318/month and $8,061/month from the indexed account

✅ PLUS, he will have $3,600/month of social security (starting at age 70) that will be a wonderful hedge against inflation and will provide an added income stream to pay for long-term care, if needed.

And remember, all of this is done (in both scenarios) without any risk of losing money in the market 🤯

Let’s chat 💬😎