The 2 Diverging Approaches to Retirement Income Planning: The Safety-first, Market Independent Income Approach (pt. 2)

(don’t forget to checkout the video of this blog too)

Like I talked about in the first video of this 2-part series, The Probability-based Approach relies heavily on market performance and ongoing management.

But, the second approach (which is really my retirement planning philosophy) focuses on first creating market-independent income sources (that are NOT reliant on market performance).

Your first source of market-independent income with likely be your Social Security Income and/or your Pension Income (if you have one).

Creating additional market-independent income is often done using the income-paying leverage of an insurance company.

This might be done with some type of immediate or deferred Income Annuity, or simply a vehicle designed to absorb volatility from the market (thereby eliminating risk from your portfolio).

This often allows for a much higher income withdrawal rate than simply relying on The 4% Rule.

In fact, in many cases, you can increase your safe and predictable income by 50% or more.

Plus, you gain peace-of-mind by having the bulk of your fixed, retirement expenses being covered by contractually guaranteed sources of income (that you can never outlive).

This means you never have to worry about the performance of the market in retirement… if you don’t want to.

You also don’t have to wonder if your nest-egg will last well into your 90’s if you end up living a long and healthy life in retirement.

In this case, you can simply delegate that longevity risk to an insurance company and allow them to pay you a significant premium on your income as well.

This approach is simple because there is no real income management either.

Your retirement income is simply deposited into your account every month…

….rain 🌧️ or shine ☀️ ….

This truly gives you the peace-of-mind and assurance that you will never run out of money in retirement.

Plus, it gives you permission to actually spend and enjoy your money in retirement (without every worrying what is happening in the market again)!

Let’s Chat 💬😎