Join Early Retirement Today
Reply
 
Thread Tools Display Modes
The Retiree Toolkit
Old 04-03-2012, 06:43 PM   #1
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Midpack's Avatar
 
Join Date: Jan 2008
Location: NC
Posts: 21,200
The Retiree Toolkit

Just a good summary of the tools we all have to work with from Wade Pfau's excellent blog. The link is worth reading in it's (short) entirety IMO.

Pensions, Retirement Planning, and Economics Blog: The Retiree Toolkit

Quote:
The Retiree Toolkit
Developing a retirement income strategy is an individualized process which uses building blocks from a retirement toolkit. No single approach or product works best for everyone. But crafting together these various pieces can help result in a strategy to obtain a sustainable income for the remainder of one’s life. I’ve taken to calling this the retiree toolkit and “building blocks” for the toolkit. Recently I read an article by Steve Vernon describing* the same basic idea, and he calls it the retirement income menu.

The way I see it, the basic building blocks for a retirement income strategy are:

1. Social Security:

2. Part-time work:

3. Bond ladders:

4. Single Premium Immediate Annuities (SPIAs):

5. Systematic withdrawals from a volatile portfolio:

6. Variable Annuities with Guaranteed Lifetime Withdrawal Benefit riders:

Other honorable mentions for this list include reverse mortgages, long-term care insurance, and life insurance.

That’s the basic list. Now it is just a matter of fleshing out the details for each of these building blocks, quantifying their pros and cons, and considering how to best combine them to help individual retirees to best meet their goals.
__________________
No one agrees with other people's opinions; they merely agree with their own opinions -- expressed by somebody else. Sydney Tremayne
Retired Jun 2011 at age 57

Target AA: 50% equity funds / 45% bonds / 5% cash
Target WR: Approx 1.5% Approx 20% SI (secure income, SS only)
Midpack is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 04-04-2012, 04:57 AM   #2
Thinks s/he gets paid by the post
obgyn65's Avatar
 
Join Date: Sep 2010
Location: midwestern city
Posts: 4,061
Thank you for sharing, Midpack.
__________________
Very conservative with investments. Not ER'd yet, 48 years old. Please do not take anything I write or imply as legal, financial or medical advice directed to you. Contact your own financial advisor, healthcare provider, or attorney for financial, medical and legal advice.
obgyn65 is offline   Reply With Quote
Old 04-04-2012, 06:33 AM   #3
Thinks s/he gets paid by the post
 
Join Date: Aug 2010
Location: Back woods of Fennario
Posts: 1,170
I'd put SS and COLA-adjusted pensions as 1A) and non-COLA adjusted pensions as 1B). I am thinking you might take a very different strategy for COLA and non-COLA income.

Number 2 made me throw up in my mouth a little bit........
LRDave is offline   Reply With Quote
Old 04-04-2012, 08:18 AM   #4
Recycles dryer sheets
Jake46's Avatar
 
Join Date: Sep 2006
Location: Fort Collins
Posts: 194
RMDs?
Jake46 is offline   Reply With Quote
Old 04-04-2012, 08:32 AM   #5
Thinks s/he gets paid by the post
 
Join Date: Oct 2006
Posts: 4,629
Quote:
Originally Posted by LRDave View Post
I'd put SS and COLA-adjusted pensions as 1A) and non-COLA adjusted pensions as 1B). I am thinking you might take a very different strategy for COLA and non-COLA income.

Number 2 made me throw up in my mouth a little bit........
+1 I can't imagine a retirement tool kit that doesn't include pensions. And, it's important to differentiate between COLA and non-COLA.
Independent is offline   Reply With Quote
Old 04-04-2012, 08:36 AM   #6
Recycles dryer sheets
REattempt's Avatar
 
Join Date: Feb 2010
Posts: 293
Wade actually included pension is #1.

Quote:
(Any other defined benefit pensions could also be grouped in with this category if it is thought of more broadly as social capital).
__________________
FIREd at 46, 8/31/11
REattempt is offline   Reply With Quote
Old 04-04-2012, 08:38 AM   #7
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Midpack's Avatar
 
Join Date: Jan 2008
Location: NC
Posts: 21,200
Pensions were mentioned along with Soc Sec in 1). However, at the moment when I try the link, the blog post seems to have changed completely Not sure if it's temporary or what...
__________________
No one agrees with other people's opinions; they merely agree with their own opinions -- expressed by somebody else. Sydney Tremayne
Retired Jun 2011 at age 57

Target AA: 50% equity funds / 45% bonds / 5% cash
Target WR: Approx 1.5% Approx 20% SI (secure income, SS only)
Midpack is offline   Reply With Quote
Old 04-04-2012, 08:42 AM   #8
Thinks s/he gets paid by the post
 
Join Date: Aug 2010
Location: Back woods of Fennario
Posts: 1,170
Quote:
Originally Posted by Jake46 View Post
RMDs?
http://www.early-retirement.org/foru...rum-34884.html

^^^^Acronyms found here - in FAQs ^^^^^^

(Required Minimum Distribution)
LRDave is offline   Reply With Quote
Old 04-04-2012, 12:13 PM   #9
Thinks s/he gets paid by the post
Finance Dave's Avatar
 
Join Date: Mar 2007
Posts: 1,854
Thanks Midpack, most of those already in use...a few more being looked at such as LTC.

Quote:
Originally Posted by LRDave View Post
I'd put SS and COLA-adjusted pensions as 1A) and non-COLA adjusted pensions as 1B). I am thinking you might take a very different strategy for COLA and non-COLA income.

Number 2 made me throw up in my mouth a little bit........
If you are a HNW (i.e. "rich") person, be careful counting SS. Any attempt to do means testing could dramatically lower or eliminate your SS payments for folks under about the age of 57. Why 57? Based on every proposal I've read over the past 2 years or so....they all protect anyone within 10 years of retirement. I'm 50...so in my planning I estimate I'll only get 50% of what SS says I will. If I end up getting more...great!!
__________________
"Live every day as if it were your last, and one day you'll be right" - unknown
Finance Dave is offline   Reply With Quote
Old 04-04-2012, 12:24 PM   #10
Moderator Emeritus
Bestwifeever's Avatar
 
Join Date: Sep 2007
Posts: 17,773
Thanks, MP.
__________________
“Would you like an adventure now, or would you like to have your tea first?” J.M. Barrie, Peter Pan
Bestwifeever is offline   Reply With Quote
Old 04-04-2012, 02:53 PM   #11
Thinks s/he gets paid by the post
Free To Canoe's Avatar
 
Join Date: May 2008
Location: Cooksburg,PA
Posts: 1,873
Quote:
Originally Posted by obgyn65 View Post
Thank you for sharing, Midpack.
+1
__________________
Free to canoe
Free To Canoe is offline   Reply With Quote
Old 04-04-2012, 03:42 PM   #12
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2003
Location: Kansas City
Posts: 7,968
Quote:
Originally Posted by Midpack View Post
Pensions were mentioned along with Soc Sec in 1). However, at the moment when I try the link, the blog post seems to have changed completely Not sure if it's temporary or what...
I had rental RE early on which I sold and consumed the cash later - all in the early phase of our ER.

heh heh heh -
unclemick is offline   Reply With Quote
Old 04-04-2012, 04:16 PM   #13
Thinks s/he gets paid by the post
kyounge1956's Avatar
 
Join Date: Sep 2008
Posts: 2,171
Quote:
Originally Posted by Jake46 View Post
RMDs?
Wouldn't RMD's fall under #5? An IRA portfolio is "volatile", isn't it--even if the IRA holds a CD ladder, the interest rates change as each CD matures and is rolled over into a new one (or not).
kyounge1956 is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
The Danger of Low Carb Diets.. REattempt Health and Early Retirement 121 05-07-2012 07:28 PM
Is anyone sad that the stock market is going up? FUEGO Young Dreamers 45 04-07-2012 12:46 PM
Was Byrd's plane ever returned to the USA? veremchuka Other topics 7 04-04-2012 09:43 PM
The Roth IRA movement: Tuesday 27 March Nords Young Dreamers 19 04-02-2012 02:05 AM
Free the Elwah!! Chuckanut Other topics 1 04-01-2012 08:14 PM

» Quick Links

 
All times are GMT -6. The time now is 04:12 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2024, vBulletin Solutions, Inc.