StraightLine CMU Fiscally Fit 2-21-20 - Final.ppt ... 2020.pdf · Microsoft PowerPoint -...
Transcript of StraightLine CMU Fiscally Fit 2-21-20 - Final.ppt ... 2020.pdf · Microsoft PowerPoint -...
StraightLine Education
CMU Fiscally Fit
“The 3 P’s for Pre-Retirees”
Predictions, Protection, Pitfalls
Michael F. Bisaro AIF®
Vice President
Predictions
Predictions
Predictions
Protection
The proper number of funds
The proper style of funds
Reviewing past performance only
Diversify Accounts Properly
Diversify Accounts Properly
Source: Lazard Asset Management, January 2020
What Makes An Account Conservative?
Interest Rates Since 1980
Rising Interest Rates?
Bond prices and interest rates generally move in opposite directions
What Makes An Account Conservative?
Future diversification may require different thinking
Pitfalls
1) Budget your expenses – current & future
2) List “Guaranteed” sources of income
3) Gap between 1 & 2 = Amount to come fromsavings
4) Size of the gap determines how large yourpool of investments must be
Withdrawal Rates
3-5% +
Not Understanding YOUR Needs
Ideal withdrawal rates – Approximately 3-5%
Required Annual
Withdrawal
Your Approximate
“Number”25x =
Not Understanding YOUR Needs
Required Annual
Withdrawal
Your Approximate
“Number”25x =
Monthly Spending Need = $1000
$12,000 $300,00025x =($300,000 x 4% = $12,000)
($12,000 / 12 = $1000 per month)
Not Understanding YOUR Needs
Required Annual
Withdrawal
Your Approximate
“Number”25x =
Monthly Spending Need = $2500
$30,000 $750,00025x =($750,000 x 4% = $30,000)
($30,000 / 12 = $2500 per month)
Not Understanding YOUR Needs
Increasing Savings vs. Reducing Expenses
2020 403(b) AND 457 contribution limits
Catch-up (age 50+)
Increasing Savings vs. Reducing Expenses
2019 AND 2020 IRA contribution limits
Catch-up (age 50+)
*2019 Contribs. can be made until April 15, 2020
Increasing Savings vs. Reducing Expenses
Required Annual
Withdrawal
Your Approximate
“Number”25x =
Monthly Spending Need = $1000
$12,000 $300,00025x =($300,000 x 4% = $12,000)
($12,000 / 12 = $1000 per month)
Increasing Savings vs. Reducing Expenses
Not “Maximizing” Social Security
Wills
Powers of Attorney
Healthcare
Financial
Trusts
Failing to Protect Your Estate
StraightLine Group, LLC
The opinions and information contained herein have been obtained or derived from sources believed to be reliable, but StraightLine Group LLC makes no representation as to their timeliness, accuracy or completeness or for their fitness for any particular purpose. This report is not intended as an offer or solicitation for the purchase or sale of any security or other financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors. This does not take into account your individual circumstances, investing objectives, tax or financial situation, or your existing or target portfolio. You should view this information and general guidance in the context of your overall portfolio construction, asset allocation, and whether a particular equity should be bought, held, or sold in relation to the current market environment.
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