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Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
Retirement Planning - Self Reliance Fair
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Retirement Planning - Self Reliance Fair

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Slides presented November 6, 2010 at LDS Self-Reliance Fair, Rexburg Idaho

Slides presented November 6, 2010 at LDS Self-Reliance Fair, Rexburg Idaho

Published in: Economy & Finance
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Transcript

  • 1. Retirement Planning
  • 2. As we obey the counsel to avoid and get out of debt now, we use our agency and obtain liberty to use our disposable income for helping and blessing others. - Robert D. Hales, October 2010
  • 3. To those of you who are not yet to the season of life when you might serve a couple mission, I urge you to prepare now for the day you and your spouse may do so. As your circumstances allow, as you are are eligible for retirement, .... - Thomas S. Monson, October 2010
  • 4. Social Security Defined Benefit Plans Personal Savings (IRAs / 401k) Employment Earnings
  • 5. Defined Benefit Only Defined Contribution Only Both DB and DC Plans 26 67 7 22 16 62 Worker Participation Percentage by Plan Type Source: Employee Benefits Research Institute 1979 2008 % % % % % %
  • 6. Social Security Employer Pension 401(k) - IRA Savings 66 11 13 49 19 21 21 21 42 Largest Source of Retirement Income Source: Pew Research Center Current Retirees Baby Boomers Ages 41-49 Adults Ages 18-40 % % % % % % % % %
  • 7. How Much?
  • 8. Inflation Longevity Market Spending Income Issuer Healthcare Household Shock Public Policy Retirement Risks Source: Retirement Income Industry Association
  • 9. Inflation Longevity Market Spending Income Issuer Healthcare Household Shock Public Policy Investment Related Retirement Risks Source: Retirement Income Industry Association
  • 10. How Long?
  • 11. For healthy 65 year-old couples 50% chance one spouse will live to age 92 Source: Annuity 2000 Mortality Tables, NewYork Life
  • 12. For healthy 65 year-old couples 25% chance one spouse will live to age 97 Source: Annuity 2000 Mortality Tables, NewYork Life
  • 13. Mind the Gap
  • 14. Gap = Living Expenses less Social Security & Pension $50,000 - $20,000 = $30,000
  • 15. Social Security Estimate www.ssa.gov/oact/ quickcalc/index.html
  • 16. Spending Rate = Gap / Nest Egg $30,000 / $750,000 = 4%
  • 17. 0 10 20 30 40 50 60 70 80 2% 3% 3.5% 4% 4.5% 5% 6% 7% 8% 9% 10% 30% Equity 70% Fixed 50% Equity 50% Fixed 70% Equity 30% Fixed Annual Spending Rate Probability of Retirement Ruin - 65Year Old % % % % % % % %
  • 18. 0 10 20 30 40 50 60 70 80 2% 3% 3.5% 4% 4.5% 5% 6% 7% 8% 9% 10% 60Year Old 65Year Old 70Year Old Annual Spending Rate Probability of Retirement Ruin - 50% Equity / 50% Fixed % % % % % % % %
  • 19. 13.1% 29.2% Probability of Ruin 50% Equity 50% Fixed Income Portfolio 6.3% 4.5%-28.0% Spending RateReturn
  • 20. 1%
  • 21. 10%
  • 22. Single Premium Immediate Annuity also know as Lifetime Income Annuity
  • 23. Lifetime Income Annuity Estimate www.immediateannuities.com
  • 24. Joint Life Income (100% to Survivor) 65Year Old Couple $30,000 annual = $504k
  • 25. Real interest rate (i.e. net of inflation) 3% Years until retirement 25 Current Savings $150,000 Annuity Cost $504,000 Additional Savings for Inflation Protection $100,000 Minimum Annual Savings to Fund Annuity $9,427 Min Annual Savings to Fund Annuity + Protection $12,090 Simple Retirement Calculator
  • 26. Simple Retirement Calculator bit.ly/aqDyWn
  • 27. 3% ???
  • 28. Questions and Answers

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