As we mentioned before, retirement planning has six major parts:

  • Provide retirement lifetime income
  • Avoid volatility and risk of loss
  • Have emergency funds
  • Maintain control and flexibility
  • Combat inflation
  • Leave a legacy for your spouse or heirs                                                                                                                                                                                                                                                                                                                                                  Retirement income is the most crucial part for a successful retirement. Income should be sufficient for a comfortable and desirable lifestyle. It has four components:
  • Social Security benefits, which are absolutely predictable and can be calculated here. It is an estimation based on your earning records. 
  • Pension (if you are the lucky one to have it). 
  • Income, based on your retirement savings. “Retirement savings” income can be “4% Rule” income from your 401(k) plan or annuity. An annuity is the most common solution for lifetime retirement income.
  • Another possible source of lifelong reliable income can be Indexed Universal Life Insurance (IUL), which requires specific knowledge of policy details. It means you have to buy IUL from an honest financial professional. Otherwise, it will not be as efficient as it should be. Young people and high-income individuals benefit the most from IUL