57-year-old Couple Wants to Beat $7,000/month Guaranteed Income with the Market (in 10 years)

(don’t forget to checkout the video of this case study)

⭐️ Here are the details ⭐️

✅ Ashley & George are both 57

✅ They have $3,000/month of social security starting at 67

✅ They want an additional $7,000/month of retirement income

✅ They don’t want an annuity so they are going to beat one with the market

✅ Total Investment Assets = $895,000

⭐️ Income Annuity Details ⭐️

✅ $620,000 into an income annuity today will provide $7,032/month of guaranteed income in 10 years

✅ That will leave them $447,000 of flexible spending money in retirement ($275k growing at 5% per year for 10 years) on top of the guaranteed $10,000/month+ that they have (when factoring in social security income).

⭐️ How to Beat an Income Annuity with the market⭐️

✅ 7% average return for 10 years & 7% withdrawal rate*

✅ 8% average return for 10 years & 6.5% withdrawal rate*

✅️️ 9% average return for 10 years & 6% withdrawal rate*

✅️️ 10% average return for 10 years & 5.5% withdrawal rate*

note: experts typically recommend taking ONLY 4% per year out of an investment portfolio so you don’t take on too much risk of running out of money.

These are the required returns and withdrawal rates required to beat the income element of an income annuity.

As you can see, you are heavily relying on the market to perform leading up to retirement AND in retirement, which leaves you very exposed to the sequence-of-return risk.

This is the compounded risk associated with pulling income out of market assets when the market is dropping.

This is one of the biggest reasons that portfolios fail in retirement…

Translation: how people run out of money in retirement!

🚨 Important to remember 🚨

If the annuity ever runs out of money, you keep getting paid forever, but the market offers no guarantee.

Let’s chat 💬😎