In your retirement years you might not want to be consistently earning a paycheck and saving. Now it’s time to actually live off of what your have saved through out your career. This is a scary thought for many people, and running out of money in retirement is one of the biggest concerns among retirees. The truth is, Retiree’s control their own destiny…and proper planning is key.  The first thing you might consider doing is sit down and write out a simple plan asking yourself these questions.

• How old do you plan to be when you retire?
• How long do you plan on being retired? (assume living well into your 80s or 90s)
• When will you start to collect Social Security?
• How much will it be? (Check your most recent Social Security Statement for an estimated amount)
• How much will you spend each year in retirement? (build in additional 3%-5% annually for cost of living adjustments)
• Do you want to leave money to anyone?

Now that you have rough idea of what your retirement goals are: you may want to find an advisor who you feel comfortable with and will help you meet those goals.  Interview several advisers and look for ones that:

• Listen to you and your plan, before they make recommendations
• Will provide you with references upon request (ask for current clients and professional relationships)
• Explains how they will work with you and what you can expect. (Understand the process of working with them and how and when they get paid)
• Will provide you with their background in the Financial Industry (A good rule before you ask, is to first decide how many years of financial services experience the planner needs to make you feel comfortable.)
• Look for an Advisor that you feel comfortable working with and sharing your concerns  (If you are not comfortable with an Advisor or do not like their style, you most likely will not grow to like it)

Once you have found an advisor you like, and together have put in place a plan for retirement , it is time to learn some key lessons.

1. Understand the difference between distribution and rate of return- (Distribution is the amount of money you draw off your assets, Return is the amount of money your assets make.)
2. The earlier you start a distribution, the greater your chances are of running out of money  (It is recommended  that you work with your advisor to calculate your withdraws and the best method of use.)
3. Distribution rates should generally be in line with your investment objectives and time horizon.  ( The longer you are facing retirement the lower the distribution rate should be)

As you can see a few percentage points can make a big difference on how long your money will last.

At Flagstone we specialize in forming and implementing fixed income distribution plans designed to help individuals live comfortable in retirement.

For more information on income distribution planning, or to learn about certain types of investments that provide a stream of retirement income please do not hesitate to contact us toll free at 866-892-2081, or fill out the form at the top of this page.