RETIREMENT INCOME PLANNING
A Successful Retirement
A successful retirement begins and ends with your ability to meet your income needs. In fact, the primary level of retirement success is not outliving your income. It is important you begin planning well in advance, but the plans you put in place during the 5 years leading up to your retirement date are critical.
Our experience up until the age of retirement is that we have seen your account value increase over time. As you begin to withdraw income during retirement you may have a range of outcomes. You may see your asset value increase (although rare due to your income withdrawals), you may retain your original balance or you may see your asset value decrease over time (which is a more common experience).
Asset value is not as important as the ability for your assets to generate an Inflation Adjusted Income that last for you lifetime. The green line below is what is most important.
3 Factors Impacting Success
Deposits & Withdrawals—You are in control of your deposits and withdrawals during retirement. We will provide you guidance on
income levels, but understanding the impact of planned and unplanned distributions is critical in developing a successful strategy.
Asset Allocation—Herr Capital Management will develop an investment policy statement and investment strategy consistent with
your preferred level of risk and offers a realistic probability of achieving your goals.
Sequence of Return—The sequence of return is perhaps the least understood investment concept but one of the most important factors impacting your retirement success. Unfortunately, it is a factor that cannot be controlled by you or your advisor. However, some of this uncertainty can be dealt with by using strategies your advisor can develop with you.
All factors vary with each individual, therefore future outcome is unique to you.