Guidance

RESOURCES TO HELP SHAPE YOUR FINANCIAL FUTURE

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David M. Bruskin
Senior Vice President and Senior Portfolio Manager
Wintrust Wealth Management

Planning for retirement income for life involves a number of issues, some of which are unrelated to finance and investment strategies. Ultimately though, the key is to devise a plan that derives an adequate cash flow out of one’s investment portfolio.

Those who are retired, or nearing retirement, should be making preparations to turn savings and 401(k)s into an income that will support them for the rest of their lives. This is no easy task, especially in the current economic environment where there are no shortages of things to worry about. We are at a time when a significant portion of the U.S. population is preparing to retire and are facing an increasing set of risks to their long-term financial plan.

Investors should approach retirement planning to address three main financial needs: income, growth, and asset protection. Growth needs can be managed largely through asset allocation, and asset protection can be addressed through instruments such as long-term care and life insurance.

However, addressing income considerations is a bit more complex. It requires a close examination of planned portfolio withdrawals and the timing of pension and/or social security payments to fully understand income sources and needs. With these in mind, there are many potential solutions. An investment strategy that utilizes cash flow generation from rising dividends and interest income can be attractive for investors trying to balance current spending needs with potential future purchasing power. In addition, other innovative techniques to consider are immediate annuities, covered call writing, and inflation-protected securities—to name just a few.

As the oldest of baby boomers turned 65 over the past year, the much anticipated retirement of many is under way. As the definition of retirement has dramatically changed over the years, so has the importance of retirement income planning to ensure that retirees continue to have choices. To create or review your plan for retirement income, schedule an appointment with one of our Financial Advisors.