Over the past few months we have been detailing the findings of Morningstar’s Gamma research, which highlights the value of smart financial planning. This post will summarize the last of the five strategies, liability relative investing. The research notes that “the purpose of the portfolio is to pay for an ongoing liability, which in the [...]
While the Morningstar Gamma research found that a dynamic withdrawal strategy has the greatest impact on retirement income, the strategy above was a close second. Asset Location Asset Location refers to where asset types are held. For example, a general rule of thumb is to hold stocks in taxable accounts as they are subject to [...]
The Morningstar Gamma research cites Annuity Allocation as one of the five ways to increase retirement income. They assume 25% allocation to a fixed annuity with a payout rate of 5.71%. What’s the catch? The most important thing to note is that a payout rate is far different from a rate of return. The payout [...]
As financial planners, we are often asked about how to fund retirement income needs. Traditionally income in retirement has been thought of as a three-legged stool-Social Security, pension, and withdrawals from savings. Today’s retirees still count on Social Security, some receive a pension from their former employer, and most rely on withdrawals from their investments [...]
In our previous post we noted that the research on Gamma identifies 5 financial planning strategies that add to retirement income. The first of these is Total Wealth Asset Allocation. The simplest definition of this is using a client specific asset allocation strategy based on how much risk is appropriate rather than relying primarily on [...]
A recent study from Morningstar suggests that implementing solid financial planning strategies can increase a retiree’s investment income by 29%, which they equate to an additional 1.82% in investment returns every year. If we consider a $1 million nest egg applying the standard 4% annual withdrawal rate, that is nearly an additional $12,000 in your [...]
Traditionally the costs associated with investing have been fairly difficult to ascertain. Mutual funds charge expense ratios to pay managers and support staff while custodians and plan administrators also need to be compensated. These costs are deducted from the funds invested in your accounts, but typically the expenses are not itemized on your statement and [...]
Have you been seeing the commercial below a lot lately? What is Medicare Open Enrollment? It is open enrollment season for Medicare prescription drug (Part D) and Medicare Advantage Plans (Part C). The enrollment period runs from October 15th through December 7th and allows participants to make changes to their coverage for the coming year. [...]
One of our most important jobs as financial advisors is to help our clients manage risk. This takes on many forms, but one of the most central is investment risk. We frequently hear the phrases, “I don’t want to lose money,” and “I only want safe investments.” Investing over the past several years has certainly [...]
Businessweek recently ran an article exposing $2 billion in losses last year among employees of the five largest Wall Street banks-JPMorgan Chase, Bank of America, Citigroup, Goldman Sachs, and Morgan Stanley. The losses were attributable to company stock, in many cases the employee’s largest holding within their 401k plans. With the recent Occupy Wall Street [...]
We’ve created a few documents that may assist you in sorting and gathering your financial data.
