SUBSCRIBE
Enter your Name and Email address to get
the newsletter delivered to your inbox.
Please include name of person that directed you to my online newsletter so I can thank them personally.
Nate Obringer, CFP®, RICP®
Financial Planner
Prudential Advisors
9800B McKnight Road, Suite 223
Pittsburgh, PA 15237
Phone: 412-318-4129
Fax: 877-840-2322
Email: nate.obringer@prudential.com
November/December 2018
Ready, Set, Spend
After a lifetime of saving, you’re ready to retire. Now it’s time to do something some retirees find hard to do: Shift from a saving to a spending mindset.
Big Transition
This transition is harder than you might imagine, and it’s no wonder why. If you’re like most people, you spent a lifetime preparing financially for this time of your life. And maybe you were as frugal as possible during some portion of your saving years. The idea of draining your retirement funds after spending years building them up can be an initially scary thought.This is understandable, but it’s time to spend your savings on things you couldn’t do while you worked full-time: Spend more time with grandchildren, take an extra vacation or two and take up other activities you like that may cost you money. Remember, though, this time of your life still involves planning – just a different type than before.
Strategy Shift
One of the first things you should do even before retiring is to forecast all of your expected income from retirement plans, annuity payments, Social Security and other sources. You can expect Social Security and possibly annuity payments (if you have the lifetime income option) to last a lifetime, but your other income is finite and requires a distribution plan.Working closely with an advisor, determine how long your 401(k) and other investments need to last, and then create a distribution strategy that results in a regular income stream. This strategy should also take taxes into account. For example, cashing in your retirement plan balance and not reinvesting it in a similar tax-qualified investment promptly can create a big one-time tax event, so plan accordingly.
Distribution Strategies
Generally, experts recommend that retirees draw from their taxable investments first, letting tax-deferred accounts potentially grow. Using this strategy, however, can trip you up later. You must begin taking 401(k) and traditional IRA withdrawals in the year after reaching age 70 ½ or face a penalty on the required amount not withdrawn. These “required minimum distribution” rules don’t affect Roth IRAs.Even in retirement, you may want to invest a portion of your portfolio for growth because annual inflation is likely. Talk to your advisor to learn more.
CONTACT US
Enter your Name, Email Address and a short message. We'll respond to you as soon as possible.
Nate Obringer is a Financial Planner with, and offers securities and investment advisory services through LPL Enterprise (LPLE), a Registered Investment Advisor, Member FINRA/SIPC, and an affiliate of LPL Financial.
"Prudential Advisors" is a brand name for the proprietary retail sales channel of The Prudential Insurance Company of America ("PICA") and its insurance company and other affiliates (collectively "Prudential"). Prudential Advisors financial professionals are licensed insurance agents of Prudential.
Pursuant to a strategic relationship among Prudential, LPLE, and LPL Financial, Prudential Advisors financial professionals provide securities brokerage services and/or investment advice on securities solely as registered persons of LPLE, an affiliate of LPL Financial. These financial professionals are permitted to brand under "Prudential Advisors". LPLE and LPL Financial are not affiliated with Prudential.
This newsletter is general educational information provided by a Prudential Financial Professional and is not intended to market or sell any specific products and services, but rather provide general information about the subject matter covered only.
Prudential Advisors and LTM Marketing Specialists LLC are unrelated companies. This publication was prepared for the publication’s provider by LTM Client Marketing, an unrelated third party. Articles are not written or produced by the named representative.
The information and opinions contained in this web site are obtained from sources believed to be reliable, but their accuracy cannot be guaranteed. The publishers assume no responsibility for errors and omissions or for any damages resulting from the use of the published information. This web site is published with the understanding that it does not render legal, accounting, financial, or other professional advice. Whole or partial reproduction of this web site is forbidden without the written permission of the publisher.