Protect and maximize retirement income
Building a retirement nest egg is just the first step in preparing for a comfortable retirement. Of equal importance is a sound strategy for withdrawing from those savings. Investors need to be as disciplined in this step as they were in the first.
There are many unknowns when it comes to planning for investment income in retirement, two of which are lifespan and rate of return on investments. Let’s face it, if we knew the date of our demise and the return, we would achieve on our investment portfolios, we would know the exact amount we could withdraw each year in order to spend our last dime on our last day, assuming that was the intention.
Studies do show, however, that withdrawing four per cent of the value of an investment portfolio in the first year of retirement, then increasing that withdrawal by the rate of inflation each year afterward, has a 12 per cent chance of providing income to that investor for the next 30 years. That is a good starting point, and has proven to be effective during periods of rising and falling stock markets and high and low interest rates and inflation.
A return of four per cent may sound like a low target, but consider the annual inflation increase added to that number and you can quickly see the challenge. Assuming two per cent annual inflation, the withdrawal in years two and three would be 4.08 per cent and 4.16 per cent. If, like Einstein, you consider the power of compounding to be one of the true miracles of life, you will understand how quickly your withdrawals would rise.
All of which brings us to the most important component of this strategy, careful management of your investment portfolio. A carefully constructed retirement investment portfolio must contain the two key asset classes, stocks and bonds. Stocks can provide long-term growth of capital and high, and rising, dividend income. Bonds can provide stable interest income, safety of principal and potential capital gains. Also, investors need an experienced, competent money manager to oversee the periodic rebalancing between those two asset classes, in order to mitigate the devastating blow of market declines, and to work closely with the investor’s accountant, to be sure to implement a tax-efficient withdrawal strategy from RRIF’S, TFSA’S and Regular Investment accounts.
Like many of our clients, you may be thinking that you would prefer to withdraw more of your savings early in retirement while you are still young enough to enjoy it. We would caution that, while that is certainly a consideration, maintaining a large-enough portfolio to meet health care needs later in life can reduce stress levels considerably at that time and provide for more comfort in your final years. Assisted living expenses can run from $2,500-$5,000 per month, with an equally large difference in the experience from one to the other. Having the financial ability to make the choice which is best for you is worth planning for. Cancer Society for 20 years, and helping with community activities. Her passion was to knit, quilt and bake for her family. Phyllis was a devoted wife to husband, Lawrence for 60 years, mother to three children, grandmother to thirteen who adored her and “Cookie” Nannie to her 18 great grandchildren. Surviving are her sister; Hilda Messenger, Centrelea, daughter: Nancy Ann (Hal) Cross, Clarks Summit, PA, son William “Bill” Lawrence (Bonnie) Spurr, Melvern Square, daughter in law; Cheryl Spurr , Melvern Square, grandchildren; Mark (Rebekah) Cross, Andrew (Bethany) Cross, Rachel(ron) Hayes, Beth (Zach) Sprowls, Mary (Kevin) Dorey, Lisa (Keith)jenereaux, Melissa (Nicholas) Murray, Melanie Spurr, William (Lauren) Spurr, John Spurr, Justin Spurr,
The design did what Mahar had asked Leblanc and Clarke to do: it sparked a wide-spread trend, with 10 customers getting inked with the tattoo on the first day it was available. Since then, over 100 people have gotten the tattoo.
“That’s a lot for something they just started,” says Mahar.
Leblanc was honoured to hear how much it meant to one of their customers.
“She was a lady that had had a lot of struggles here in the Valley and had decided to move away, while getting this tattoo she started crying profusely because it meant so much to her,” Leblanc said. “Crying happy tears because she felt so moved that she was getting this tattoo and was spreading this.”
The creators are hoping the design will soon make its way into tattoo shops around the world.
Free decals with the design are available through Everlasting Ink for anyone wishing to support the cause without getting a tattoo.
“We hope it goes worldwide,” she added. Katie (Brad) Campbell and Amy Spurr. Phyllis was predeceased by husband, Lawrence William, son; Gordon Cameron, brothers; Curtis, Charles, Vernon, Wilfred, Arthur, sisters; Grace Young and Cora Goodwin. There will be a visitation 6:00 pm-8:00 pm Wednesday, May 31 at Middleton Funeral Home, 398 Main St., 902-825-3448. A Celebration of Life will be held at 2:00 pm Thursday, June 1, at Fellowship Baptist Church, Melvern Square, with Rev. Bruce Kaiser officiating. Interment will be in Church Grove Cemetery, Melvern Square. In lieu of flowers, donations may be made to Fellowship Baptist Church or Blomidon Bible Camp or Canadian Cancer Society. Online guestbook may be signed by visiting: www.middletonfuneralhome.com