A graduate of Youngstown State University in Ohio, Darren Morgan has worked in asset management for over 25 years. He is currently the owner of darrenMORGAN Asset Management, where he serves as principal and senior advisor. Among his specializations, Darren Morgan advises clients on retirement income planning.
Retirement income planning involves recognizing income sources, calculating expenses, executing a savings policy, and organizing assets and risk. While a good retirement income planning strategy should be particular to an individual needs and goals, there are a few strategies that one can build upon to achieve a reliable plan.
A retirement income planning strategy includes formulating a retirement withdrawal policy, such as the 4% rule. This theory recommends withdrawing 4% of retirement savings in the initial year of one's retirement and subsequently building on the same pattern for the succeeding years while also accounting for inflation. However, this strategy is not suitable for every individual mainly because it assumes a fixed income source in retirement and disregards shifting spending patterns. Furthermore, it may assume that an individual would invest at least 50% of their portfolios in equity.
Another strategy for a retirement withdrawal policy involves a dynamic withdrawal method whereby individuals can modify their withdrawal amounts annually based on investment performance. This plan has a higher chance of complication due to personal needs. In this case, a financial advisor would help to create a solid dynamic plan toward one's goal.
The bucket method is another withdrawal strategy that involves developing various savings vehicles to accomplish particular goals. Finally, it is helpful to develop a tax strategy to reduce taxes on retirement plan withdrawals. If an individual has reserved a reasonable nest egg (money saved or assets invested for retirement) in taxable investments like a brokerage account, it is useful to begin by withdrawing sums from there.
Retirement income planning involves recognizing income sources, calculating expenses, executing a savings policy, and organizing assets and risk. While a good retirement income planning strategy should be particular to an individual needs and goals, there are a few strategies that one can build upon to achieve a reliable plan.
A retirement income planning strategy includes formulating a retirement withdrawal policy, such as the 4% rule. This theory recommends withdrawing 4% of retirement savings in the initial year of one's retirement and subsequently building on the same pattern for the succeeding years while also accounting for inflation. However, this strategy is not suitable for every individual mainly because it assumes a fixed income source in retirement and disregards shifting spending patterns. Furthermore, it may assume that an individual would invest at least 50% of their portfolios in equity.
Another strategy for a retirement withdrawal policy involves a dynamic withdrawal method whereby individuals can modify their withdrawal amounts annually based on investment performance. This plan has a higher chance of complication due to personal needs. In this case, a financial advisor would help to create a solid dynamic plan toward one's goal.
The bucket method is another withdrawal strategy that involves developing various savings vehicles to accomplish particular goals. Finally, it is helpful to develop a tax strategy to reduce taxes on retirement plan withdrawals. If an individual has reserved a reasonable nest egg (money saved or assets invested for retirement) in taxable investments like a brokerage account, it is useful to begin by withdrawing sums from there.
