Retirement Income That Never Runs Out

Instead of the fundamentally flawed rate of return retirement income approach (also known as the “4% rule”), the Safety Net Retirement System focuses on what matters most to retirees – a protected income that will never run out of providing cash flow for the rest of their life, regardless of how long that is and regardless of what happens in the unpredictable financial markets. This is what we call a “purpose of the money” focused approach, rather than a “rate of return” focused approach.

How the Safety Net Retirement System Works

We start by analyzing how much income you need to meet two levels of spending needs:

1.   A minimum level of cash flow to meet your essential, or “have to have”, spending needs. This is money you need to pay the bills you will always have, or will have for a specific period of time (like paying off a mortgage). For example, things like food, utilities, mortgage or rent, medical insurance, transportation, etc. You need to know that you will always have this level of minimum monthly income to meet these needs, regardless of anything else.

2.   A desired level of cash flow to meet your extra, or “want to have” spending needs. This is money you want to pay for things that, while they may not be absolutely necessary to life, you want to have to live a certain lifestyle that you desire. For example, things like vacations, golf club memberships, gifts to grandchildren, etc.

Once we’ve determined your needs for income above, we look at your current sources of guaranteed income, namely Social Security (or any other federal retirement programs you may have) and any pension plans you might have from current or former employers.

A Safety Net Retirement System income plan is then custom designed for you to provide for any shortfall (or “income gap”) you may have between your current sources of guaranteed income (Social Security & pensions) and the minimum and desired levels of cash flow needed to meet your essential and extra spending needs. This income gap is typically filled with guaranteed income contracts that are funded by your other available retirement savings and investments.

How the Safety Net Retirement System compliments your investments

With whatever amount is left over from your retirement savings and investments that is not needed to fund the Safety Net Retirement System, you are free to use it however you want to fund other spending needs outside of the need for monthly income, or to invest it for long term growth and capital appreciation. By having the high level of confidence you get from the Safety Net Retirement System that your retirement income needs will always be met, if you choose to you can put this portion of your money in growth oriented investments without having to worry about short-term market fluctuations. That’s why the Safety Net Retirement System works so wonderfully together with our Low Risk, Low Volatility Investing method.

How the Safety Net Retirement System Benefits You

In summary, the Safety Net Retirement System gives you a peace of mind about your retirement income by providing you with:

The first step to getting started with designing your successful financial future is to schedule a free, no-obligation initial strategy session with Marvin Bales, CPA, CFP®.  In this 30 minute strategy session, we’ll discuss your financial goals and objectives, and then we can mutually determine if we are a potentially good fit to work together.

Contact us to schedule your initial strategy session.