Understand Your Options for Distributing the P&G PST

For many nearing retirement, the decision to purchase an annuity isn’t about returns—it’s about peace of mind. But what are you really paying for that feeling of safety? With annuity sales reaching record highs, it's time to unpack the psychological tradeoffs, hidden costs, and key risks.

Timing your Social Security claim is a critical decision that impacts retirement cash flow, portfolio strategy, and long-term financial security. While delaying benefits can boost lifetime income, the right choice depends on personal health, lifestyle goals, and peace of mind—not just the numbers.

Paying off a home might not be the optimal financial decision, and there are many variables involved in analyzing the data. By using reasonable assumptions and a well-thought-out plan, the numeric disadvantages, when put in proper context, could be far outweighed by the advantages of peace of mind and contentment.

The Mega Backdoor Roth is more than an excess savings strategy; it is a potential pathway to greater financial flexibility in retirement. By harnessing the power of after-tax contributions and strategic conversions, you can greatly accelerate your retirement timeline and reduce your tax burden in retirement.

Social Security is a bedrock of retirement planning, and a key planning assumption in almost every wealth planning scenario. The important 270-page was released on May 6th with headlines indicating the projected year for “insolvency” for the Social Security Trust Fund is now 2035 as the downward trend in the ratio of workers to beneficiaries continues unabated.

To help smooth out the friction associated with this transition from working to retirement, one technique can be very helpful for a multitude of reasons: designing a “paycheck” for retirement.

It’s challenging to change the lifelong savings habit imprinted on the psyche. But if proper wealth planning and an in-depth cash flow plan yield a very high probability of the capacity to spend more, we are strong advocates. Spending on experiences and time-saving services is often overlooked; however, it can significantly enhance a retirement lifestyle without filling up the basement and garage with more stuff.

Generally, retirement accounts should remain fully invested, monitored, and left to grow over time. However, as interest rates have increased over the past year, Substantially Equal Periodic Payments (SEPP) have become a viable strategy for individuals to consider in unlocking the flexibility of retirement funds sooner while avoiding the burden of penalties.

Anyone who drives down a major highway these days can attest there is no shortage of billboards from banks advertising much more attractive yields on savings accounts and CDs. Obviously, the key driver for this major interest rate shift has been the Federal Reserve’s aggressive rate tightening, which they used to battle the not-so-transitory inflation over the past 18 months. It’s pretty easy to find many banks offering one-year CDs paying between 4.5% and 5.0%+. Read more in this month’s JIC Blog.

Retirement date, social security claiming, spending assumptions, inflation – many factors impact retirement cash flow planning. However, one of the most impactful is longevity. By studying and utilizing more accurate assumptions, retirees can have a better understanding of the risks of running out of money so the factors we CAN control can blunt the risk of the factors we cannot. Read more in this month’s JIC Blog.