As people enter retirement, the above question weighs on them. Most, if answering honestly, would say, “I am not sure”.  Some of the factors that influence the outcome are:  How long you are going to live?  What will inflation be?  How are your assets allocated and how much of your earnings do you get to keep after taxes?  After doing this for many years, I have found that there are a few holes in most people’s thinking.  They include:

  • Most people underestimate how long they will live
  • Most people overestimate how much they can withdraw
  • Most people do not achieve market rates of return
  • Most people do not control income taxes

The above factors impact whether your money will last during retirement.  There is a good chance a married couple aged 60 will need their money to last 30+ years.  Based upon statistical probability studies, one can withdraw 3-5% of one’s investment portfolio and have it last 30 years.  This means for every $1,000,000 of financial assets, one can withdraw $30,000-$50,000 a year.  This does not take into account shrinkage due to income taxes or the fact that most investors do not achieve market rates of return.  It is my experience that a customized plan to address all of the above issues must be in place to be confident that your investment funds will be there as long as you are.  Click on the link to learn more about the above study, Withdrawal Rates – The Long-Term Impact.  Contact my office if you would like me to sit with you and help you figure this out.


STANDARD COMPLIANCE DISCLOSURE: Bruce Horowitz is a Registered Representative with/and offers Securities and Advisory Services through Commonwealth Financial Network , Member FINRA/SIPC , a Registered Investment Adviser. CA Insurance License # 0B66129. Innovative Wealth Strategists is located at 6767 Forest Lawn Drive Suite 120, Los Angeles, CA 90068 This communication is strictly intended for individuals residing in the states of CA,CO,CT,FL,HI,NV,TN. No offers may be made or accepted from any resident outside these states due to various state regulations and registration requirements regarding investment products and services. Please review our Terms of Use here: http://www.commonwealth.com/termsofuse.html

IMPORTANT NOTE: The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. Due to industry regulations, comments are not permitted on this blog. If you would like to contact the author, please email us at info@iwstrategists.com.