What’s Really Going to Happen When Social Security Runs Out of Money

By Rob Cordeau, CFP®

One of the hottest topics in retirement income planning over the past several years has been how to help individuals strategize on their Social Security claiming decisions.

Organizing Your Finances After a Chronic Illness

By Bob French, CFA

Chronic illness is life-changing. When it comes to medical expense coverage, you might be looking at new regulations on the kinds of treatments available to you, the physicians you meet with, and the hospitals that are covered. Unfortunately, the older you get,…

Making Sense Out of Variable Spending Strategies for Retirees

By Wade Pfau, Ph.D., CFA

Variable spending strategies fall between two extremes: spending a set amount without regard for portfolio balance, and spending a fixed percentage of the balance.

A Tax on Giving – Understanding the Rules of the Gift Tax

By Rob Cordeau, CFP®

Getting taxed once is hard enough, but getting hit a second time on the same dollars? That’s enough to give a compliant taxpayer the urge to toss crates of tea into Boston Harbor. Whether double taxation like the gift tax is morally right or…

Black Monday Is Not a Black Swan

By Bob French, CFA

Last Monday, the S&P 500 dropped by more than 3.5%. This is a big drop, and has a lot of folks wondering if they should be invested in the market at all. It’s easy to get wrapped up in media coverage, and…

Total Return vs Income Investing: Same, but Different

By Bob French, CFA

Retirees can take 2 main approaches to spending from portfolios. 1) Focus on income and dividends produced in the portfolio, a.k.a. “income investing.” 2) Sell assets as appropriate to meet spending needs. For your portfolio, they’re basically the same thing. But, from your point of view, you should be aware of one difference: focusing on income investing can make your portfolio less diversified.

Annuity Pricing Sensitivity

By Wade Pfau, Ph.D., CFA

With all of my discussions of annuities lately, it is worthwhile to also consider the sensitivity of annuity pricing to interest rates, gender and age-related mortality factors. Relationship Between Payout Rates and Interest Rates Figure 1 estimates the relationship between annuity payout…

Securing Longevity Insurance Through Income Annuities

By Wade Pfau, Ph.D., CFA

I have published a few pieces in the past couple weeks on how income annuities are priced and used. Understanding how to use annuities can be a great benefit when planning for retirement. Let’s consider another possibility.

Annuity Pricing 102

By Wade Pfau, Ph.D., CFA

In today’s scenario, we’ll see what happens to the price of an annuity if:
1. We guarantee income will be provided for at least 10 years, regardless of whether the annuitant lives.
2. We provide a cash refund if the annuitant dies before at least receiving their full principal payment.
3. We include a cost-of-living adjustment for annuity payments.

Income Annuity 101

By Wade Pfau, Ph.D., CFA

How are different types of annuities priced? It’s not as hard as you might think, as the basic recipe requires just three ingredients:

Retirement Income Strategies with Annuities

By Wade Pfau, Ph.D., CFA

Income annuities come in a variety of shapes and sizes. It can be overwhelming to know which one makes the most sense for your situation. In this column, I explore how income annuities work and what options are available.

Withdrawal Sequencing Avoiding the Pitfalls of Retirement Distribution Order

Withdrawal Sequencing: Avoiding the Pitfalls of Retirement Distribution Order

By Bob French, CFA

Taking retirement income from your investment portfolio in retirement is like walking through a minefield. Most people don’t think about it, but your distribution strategy in retirement – how you actually take money out of your portfolio – and the resulting taxes can have a significant impact on how long your money lasts and how much you’ll be able to spend throughout retirement.