Earn for Retirement

…and protect your nest egg from significantly higher taxes in retirement.”

For most retirees, two risks loom large on the retirement landscape — tax rate risk and longevity risk.

Here’s the alarming news most  Americans don’t  want to hear: Tax rates have to rise dramatically in the next 10 years, and maybe even double, for our country to avoid fiscal insolvency. Given this reality, millions of Americans need to fundamentally change how they save for retirement.

To further complicate the issue, we are living longer than ever before, and many folks are likely to outlive their money or watch it get taxed into oblivion. But when traditional retirement distribution strategies won’t provide sufficient income in the face of higher taxes, what can you do?

The message is urgent and the time to act is now. I work with my clients as their trusted advisor to help them shift course to unique strategies and prevent their retirement nest egg from being exposed to significantly higher taxes in retirement. The combination of guaranteed, inflation-adjusted lifetime income and a proactive, asset shifting strategy can shield you from longevity risk and the cascade of unintended consequences that result from higher taxes. It’s an innovative and proven strategy that maximizes returns while effectively neutralizing the biggest risks to retirement savings.

I don’t have a crystal ball, but I can see the future consequences of unfunded obligations for programs like Social Security, Medicare, Medicaid and government pensions, as well as the 6 trillion dollars in stimulus packages that increased our nation’s debt to a staggering 31.6 trillion dollars. How is all this spending going to be financed? More DEBT! The tax freight train that is bearing down on your retirement just picked up a little more speed. Who is going to pay this tax bill when it arrives? Americans like you and me.

You may think you know how much is in your 401(K) or IRA, but unless you can predict what tax rates will be when you take that money out, you don’t really know how much money you will have. Let’s face it, if you have a tax deferred retirement account, you’re in a partnership with the federal government, and they get to determine how much you get to spend in retirement.

While this risk of higher taxes has loomed for quite some time, a second risk that very few Americans have thought about lingers as well: longevity risk. When it comes to sound retirement planning, you can’t just think about market returns–that was critical during your accumulation phase. During your retirement years, it’s all about covering basic expenses with guaranteed, inflation-adjusted income designed to last for the rest of your life. In retirement, it’s not about assets, it’s about income! Contact Brian at The East Financial Group at 225-572-6426.

Next Pillar: Save/Invest with Dave Ramsey Certified Master Financial Coach Mark Blair