Understanding
Your Income Needs
For Retirement
Once you’ve completed this workbook, bring it to your financial advisor to discuss creating a retirement income strategy that is tailored to your specific circumstances. Then, after first
considering your lifetime objectives, with the help of your financial advisor, you can consider the third level of the Retirement Needs Pyramid — legacy planning objectives.
When’s the right time to retire?
Many people have a specific age in mind as the right time to retire. Maybe 62,
the earliest Social Security benefits can begin. Or perhaps 65, the age many
conventional pensions kick in. While those are important considerations, the
best time to retire is really whenever you can afford to do so successfully.
So you save. However, your ultimate success is not about reaching a total
dollar amount; it’s about replacing a dollar amount — your income.
When can you generate enough predictable income in retirement to meet
your necessary, ongoing expenses?
First you need to look at what you envision for your retirement. Then determine your necessary living expenses, those basic necessities that you “must-have” to live in retirement. Next, decide what are the things that you desire to make your retirement personally fulfilling, the “nice-to-haves.” From there you can better make sure your assets align with your needs. This workbook can help you:
• Identify your sources of income
• Identify your anticipated expenses in retirement • Calculate any gap you may face between
available income and expenses
• Differentiate between your assets and the roles they may play in protecting yourself and your financial objectives
Legacy
Nice-to-Have
Must-Have
1.
Identify your Must-Haves
Use this section to identify your expenses and differentiate between
the types of expenses you’ll encounter in retirement.
Primary housing $
Food $
Transportation $ Utilities $ Clothing and personal care $ Medical care and insurance $ Property insurance (home, auto) $ Other insurance (life, long-term care) $
Taxes $
Other: $
Total $
MUST-HAVE EXPENSES
Must-Have expenses are the ones you simply can’t avoid — such as food, housing, insurance, taxes, and health care. To cover these needs, you should rely on sources of income that are predictable.
MONTHLY EXPENSE
PREDICTABLE INCOME SOURCES
These are the assets that are designed to provide a predictable income stream that you
can rely on throughout your retirement. Social Security $ $
Pension(s) $ $ Annuity payout(s) $ $ Other: $ $ Other: $ $ Total $ $ MONTHLY INCOME ANNUALIZED
Predictable Income Sources (Monthly) $ Must-Have Expenses (Monthly) $
Surplus/shortfall $
INCOME ANALYSIS
Take the totals you derived in the sections above to help you determine if your needs and assets are in line. You may need to reposition some of your assets for a more effective strategy.
Paycheck $
EMPLOYMENT?
Do you plan to continue working in retirement? If so, to what extent and for how long? A paycheck can help make ends meet, but, remember, it stops when you want — or need — to stop working.
Travel $ Entertainment $ Recreation $ Dining out $ Hobbies $ Charitable giving $ Other: $ Other: $ Total $ NICE-TO-HAVE EXPENSES
Nice-to-Have expenses are for your retirement dreams — travel, recreation, whatever will make your retirement personally fulfilling.
ESTIMATED MONTHLY NICE-TO-HAVE
EXPENSES
SAVINGS AND INVESTMENTS
These assets feature a balance or value that is intended to grow over time. You may draw income from any investment growth, dividends and interest, or even the principal value. However, income from these assets could be unpredictable, inconsistent and, over time, could exhaust the asset.
Employer plans (ex. 401(k), 403(b)) $ $
IRAs $ $ Stocks $ $ Mutual funds $ $ CDs $ $ Savings/Money market $ $ Bonds $ $ Real estate/Rental $ $ Other: $ $ Other: $ $ Total $ $ ESTIMATED
MONTHLY PROCEEDS VALUETOTAL
Savings and Investments (Monthly est.) $ Nice-to-Have Expenses (Monthly est.) $
Surplus/shortfall $
SAVINGS AND
INVESTMENT ANALYSIS
Take the totals you derived in the sections above to help you determine if your needs and assets are in line. If not, you may need to reposition some of your assets for a more effective strategy.
2.
Identify your Nice-to-Haves
In this section, identify and categorize the assets available to help fund the
activities you desire to personalize your retirement experience.
There’s no substitute for
professional advice
Are you confident that what you saved to fund your retirement will indeed last your lifetime? Now’s the time to sit down with your financial advisor for a review to help ensure that:
• You have sufficient assets
• Your money is positioned to align with your needs and objectives • You determine an appropriate time when you can afford to retire • You have addressed any legacy objectives you have
If anything is not as you had hoped or expected, your advisor can help you determine and implement a strategy to help get you where you want to be.
This information is written in connection with the promotion or marketing of the matter(s) addressed in this material. The information cannot be used or relied upon for the purpose of avoiding IRS penalties. These materials are not intended to provide tax, accounting or legal advice. As with all matters of a tax or legal nature, you should consult your tax or legal counsel for advice.
Annuities are issued by Forethought Life Insurance Company and variable annuities are underwritten and distributed by Forethought Distributors, LLC. Forethought is Forethought Life Insurance Company and its affiliates, subsidiaries of Global Atlantic Financial Group Limited.
Variable annuities are sold by prospectus. The prospectus contains investment objectives, risks, fees, charges, expenses, and other
information regarding the variable annuity contract and the underlying investments, which should be considered carefully before investing. Instruct your clients to read the prospectus, which can be obtained by calling (866) 645-2449, before investing.
VA5070 (06-14) 100298-2 © 2014 Forethought forethought.com
About Forethought Life
Insurance Company
Forethought Life Insurance Company provides a full suite of annuities and a leading preneed life insurance platform to help solve the pre-retirement, retirement and end-of-life challenges facing Americans today. A targeted strategy delivers multifaceted product lines to customers through key distribution relationships across the country. Experienced leadership and financial discipline underlie strong growth and success in the marketplace. Forethought is a subsidiary of Global Atlantic Financial Group Limited, a multi-line insurance and reinsurance company with over $30 billion in assets and 10 offices. Global Atlantic was founded at Goldman Sachs in 2004 and separated as an independent company in April of 2013.
