Archives for Retirement

How to Stop Sequence of Returns Risk From Ruining Your Retirement

Sequence of returns risk refers to the possibility that people who experience a stock market downturn in the first three to five years of retirement may deplete their savings prematurely if they take withdrawals from their portfolios while the market is going down. What does this mean? Let’s look at some examples. Remember, most financial advisors out there are still telling their clients that when they retire, the extent of their “retirement plan” should be to start withdrawing 4% of their retirement portfolio annually to cover their monthly living expenses. However, even if they recommend a more conservative 3% or
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Annuities and How They Can Provide Retirement Income

For most Americans, gone are the days of the reliable company pension for retirement. Today’s retirees are faced with saving up money in tax-deferred accounts like 401(k)s, then after they retire, being left to figure out how to withdraw money correctly so they don’t run out of money in retirement. Not to mention having to navigate complex income tax issues as they make required annual withdrawals starting at age 72! Meanwhile, retirees face record inflation, threats to Social Security solvency and Medicare premium increases. With longer life expectancies than any generation that ever lived before, annuities can provide a way
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How Wealthy Do You Have to Be in Order to Retire?

Even though perceptions have changed during the pandemic with more Americans now saying they need less money to feel rich1, when it comes to retirement, most people are still unclear about how much they will need to have saved before they can quit their jobs. The answer to that question is different for every person. Here are some of the things you need to think about in order to get a realistic retirement number in mind.   What do you want to do during retirement? Where will you live? Different people have different retirement goals and visions. You may not
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How COVID-19 Has Impacted Retirement Confidence

The Transamerica Center for Retirement Studies recently conducted an online survey of more than 6,000 people in the U.S. and found that many are feeling financially vulnerable. Americans are feeling a distinct lack of confidence, particularly when it comes to retirement. Whether employed or unemployed, the survey found that 23% of workers are no longer certain they can retire comfortably following the coronavirus pandemic. Not unsurprisingly, the insecurity was highest for baby boomers, born between 1946 and 1964, who are closest to retirement—32% said their confidence in their ability to retire has gone down due to COVID-19. Meanwhile, 25% of
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How a Furlough (or Layoff) Affects Your Finances…and Retirement

  Here are six things you need to know if you or a family member has been furloughed—or laid off—from their job   A furlough is an unpaid leave of absence. You don’t report to work, you don’t get paid, and you may lose some of your benefits. Getting fired or laid off is different because it is permanent; whereas, being furloughed means your employer wants you back as soon as things get back to normal, typically at the same position and income level as before the furlough. Here are six things you should know:   Filing for unemployment Whether
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The Rules Are Changing For 401(k)s In 2020

The Rules Are Changing For Your 401(k) In 2020 If you’re still working and contributing to a 401(k) or similar workplace retirement plan, there is some good news for the upcoming year. If you’re under age 50, the amount you can contribute to your 401(k), 403(b), most 457 plans and the federal government’s Thrift Savings Plan is now $19,500 for 2020—a $500 increase over 2019. Additionally, for those who are age 50 or over by December 31, 2020, the catch-up amount is now $6,500, up by $500 (and the first increase since 2015). Keep in mind that you can still
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Top Fears of Retirees

It’s October, the month that we typically celebrate “scary stuff” right up until the last day, when Halloween arrives on the 31st. Pretending to be afraid is one thing. But being fearful and anxious in real life, especially as you get older, is not fun at all. The fears that go along with retirement are exactly why we established Alpha Gamma Wealth Management in the first place. It’s our goal to address retirement risks and help ensure our clients have contingency plans in place so they are prepared—doing everything possible to make sure they won’t get shocked, surprised, or thrown
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5 Retirement Pitfalls to Plan Ahead For

We talk a lot about “risk” in retirement, because there are a lot of issues to consider. That’s why retirement planning is so important—it includes contingency plans to cover potential adverse events. Here are five examples: Incapacity Even young people face the possibility that they will become disabled or incapacitated in some way, like getting hurt in an accident—it’s far more likely to happen than we realize. But aging brings with it the risk of slow health deterioration; our bodies and minds can start to slip. It’s important to have all our estate planning documents and various provisions in place
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“Longevity Risk” in Retirement

Longevity means “long life” or “length of life.” Longevity risk is the risk that someone will outlive their money or available income—something we are very concerned about at Alpha Beta Gamma Wealth Management. It’s a fact that people are living longer. A woman who has reached age 65 can expect to live to age 86-1/2, while a 65-year-old man can anticipate living to age 84 on average. One out of every three 65-year-olds living today will live past the age of 90, and one out of seven will live past 95.1 Longevity means people may be living in retirement for
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New Paradigms for Retirement

The old notion that you should withdraw from life and sit in a rocking chair during retirement has been completely overturned as today’s older population demonstrates on a daily basis. Here are some recent facts and new ideas about retirement that you should consider before you take that last paycheck. People are living—and working—longer.1 According to the Bureau for Labor Statistics, the labor force participation rate is expected to increase faster for the oldest segments of the population than for any other segment during the 2014–2024 decade. Since the turn of the century, older workers age 55+ have grown as
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