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Advanced Retirement Planning

Advanced Retirement Planning

A Modern Perspective for Modern Markets

  • Welcome to ARP
  • About ARP
  • Our Services
  • The Modern Financial System
  • Retirement Education
  • Complimentary Consultation

Three Things You Must Have Before Retiring

If you do not have a thorough understanding of these three basic tools to strengthen and support your retirement plans, there is a high likelihood that you will encounter unpleasant financial surprises when you least expect them to occur.

  • Comprehensive Risk Analysis This is an essential, but severely underestimated, assessment when initially planning for retirement.  It simply calculates how much volatility risk your investments are exposed to and determines if your distribution expectations are realistic.  In other words, if the overall stock (or bond) market fell 30%, 40%, 50%, or more, could you continue to withdraw the same amount to live on?  In most cases, advisors and retirees just assume that the market will recover losses in a short period of time, but sometimes, this is not the case.  For example, if you retired in the year 2000, you would have had to wait almost 13 years before the stock market experienced any gains that exceeded market levels in 2000.  This is the first step in realistically planning your retirement, and we encourage all retirees to better understand their exposure to risk.
  • Retirement Income Analysis Once you understand your exposure to market risk, then you need to design a long-term income plan to determine how realistic your retirement income objective is.  A retirement income plan should be analyzed during both positive and negative market conditions to provide a realistic understanding of how either scenario can affect your retirement.  This can help determine how much volatility risk your retirement assets can tolerate while you are taking regular distributions to support your retirement.  The objective of this analysis is to better understand how much of your retirement income is at risk if markets experienced poor conditions for an extended time period.  Although we all hope that the markets will “agree” with our retirement, rarely do advisors analyze (or present) how sustainable your retirement income distributions are under less-than-ideal market conditions.  We insist on both positive and negative scenarios being considered prior to implementing a long-term retirement income plan so that you recognize the pros and cons of using the stock market as a significant source of your retirement income.
  • A Basic Understanding of the Modern Financial System Although most might not find it too exciting, we strongly encourage all of our clients to have a basic understanding of the very unique market conditions in which they are retiring.  A risk analysis and retirement income analysis can be very helpful in understanding your personal objectives, but how your personal objectives relate to current market conditions is equally important.  We teach classes regularly throughout the year to provide a detailed education on retirement income planning in very complex and potentially risky market conditions.  Understanding how your objectives can be directly impacted by market conditions is critical in the process of planning for your retirement.  Assuming that the financial markets will be “fine” and provide you with the income that you hope to have is a very risky plan.  The stronger your understanding is of modern market conditions, the more likely it is that you will be able to plan accordingly for the retirement that you would like to experience.
In the past, investors have been able to rely on a strong dividend yield from the S&P 500 to provide consistent income in addition to capital gains.  As of July 2022, the S&P 500 dividend yield remains near all-time lows, well below the historical average of 4.00%.  Without a strong dividend yield, market losses have a much greater impact on investment accounts during retirement due to the effect of distributions for income. Source: www.multpl.com

609 Deep Valley Drive, Suite #200
Rolling Hills Estates, CA 90274

Office (310) 212-7685

Fax (310) 388-0682

info@advanced-retirement.com

Investment advisory services offered through Brookstone Capital Management, LLC (BCM), a registered investment advisor .  BCM and Advanced Retirement Planning are independent of each other.  Insurance products and services are not offered through BCM but are offered and sold through individually licensed and appointed agents. The content of this website is provided for informational purposes only and is not a solicitation or recommendation of any investment strategy. Investments and/or investment strategies involve risk, including the possible loss of principal. There is no assurance that any investment strategy will achieve its objectives. Any comments regarding safe and secure products and guaranteed income streams refer only to fixed insurance products. They do not refer in any way to securities or investment advisory products. Fixed insurance and annuity product guarantees are subject to the claims‐paying ability of the issuing company and are not offered by Brookstone Capital Management.

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