Build a retirement income plan that aims for lifetime income, growth potential to combat inflation, and flexibility in mind. We all know that there is no one-size-fits-all retirement. You may want to travel the world. Your neighbor may want to garden and read. Finding the right mix for you depends on a myriad of factors including your savings, expenses, health, family, and values.
The good news is that whatever your situation, you can help improve your retirement readiness (and potentially your retirement lifestyle) by learning about 3 essential building blocks for retirement income plans. Combining them can provide a combination of growth potential, guaranteed income (i.e. Social Security, Pension, Etc.),* and the flexibility to adjust as your needs change, or life throws a curveball.
We believe a solid retirement income plan should provide 3 things:
The back-door IRA is sometimes also likened to a contribute and convert strategy. In essence, for high income earners who make too much earned income to contribute to a Roth IRA outright, there’s always the option to invest in a traditional IRA. Anyone can do that as long as you have earned income. The question is whether the contribution would be deductible or not. With this back-door Roth feature, you contribute to a traditional IRA and then shortly thereafter, convert it to a Roth. It's a two-step process to get to a Roth where you wouldn’t be able to it directly because your earned income is too high.
Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. Guaranteed income refers to ensuring core expenses are covered (i.e. Social Security, Pension Etc.) There is no guarantee that a diversified portfolio will perform better than a non-diversified portfolio in any given market. Please note that individual situations can vary. Therefore, the information presented here should only be relied upon when coordinated with individual professional advice.
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