Is your retirement income growing?
Would you keep working at a company that didn’t give you a raise for 30 years?
Over time- your income needs to grow because your expenses are likely to grow. Today a couple aged 60 will likely spend over 30 years in retirement. During that time most of your expenses will rise.
We find that some retirees focus only on the growth of their assets when they should also be focusing on the growth of their income.
So let’s look at some sources of retirement income through the lens of income growth:
• Social Security – Payments are indexed to inflation and should rise over time.
• Pensions – It’s case by case. In general, government pensions have cost of living increases while corporate pensions do not.
• Interest on Bank Accounts and Savings – If you retired 30 years ago, the interest you receive on savings has gone steadily down as interest rates have declined. We may be in an environment where rates rise for a while but interest has not been a reliable source of increasing income.
• Growth Stocks and Mutual Funds – These do not usually pay much in dividends so the opportunity for income growth is limited.
• Dividend Paying Companies and Equity Income Mutual Funds – While dividends are never guaranteed, many larger established companies have a record of paying attractive dividends and increasing those dividends over time. By way of example, Johnson and Johnson have increased the dividends paid to shareholders every year since *1961. Companies like IBM, Proctor, and Gamble, and many others have a good record of income growth as well.
If you are retired or planning for retirement, we offer a no charge, no obligation financial analysis. We’ll review your key documents, check each investment, and conduct a stress test of over 1000 market scenarios that you could face during retirement.
We hope to show you ways to improve and grow your cash income. And give you a strategy to manage the risks you face (like inflation). We’ll also provide an unbiased calculation that shows how much you should be able to safely spend in each year of your retirement.
The analysis is detailed and comprehensive, and it’s free for you. When the process is complete we’ll even give you a $100 gift certificate to Ruth’s Chris Steak House.
Some of those who take advantage of this offer become clients of our firm. But often we serve to validate the strategies already in place with perhaps a few suggestions. The process and offer are designed for those age 50 and up who have retirement assets of $500,000 and over (including 401k’s IRA’s, stocks, bonds, mutual funds, annuities, and bank accounts).