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Jim Lentini: Be confident in retirement

Posted: August 17, 2009 8:38 p.m.
Updated: August 18, 2009 4:55 a.m.
Americans who are retired or are planning to retire are facing challenges today that did not exist twenty or thirty years ago.

Unlike previous generations, whose brief retirements were funded primarily through employer pensions Americans who are retired or are planning to retire are facing and Social Security, you will be responsible for much of your retirement income, and your personal savings will be your most important source.

Confidence in retirement
Your retirement income is your responsibility. Are you confident in your plan? Most lack of confidence usually stems from confusion.

Your retirement may last longer than 30 years! Your money will need to last just as long. What will it take to support the future income you want?

Other factors beyond your control may also impact your retirement planning. Pensions and Social Security will likely not provide all the income you need, while longevity and increasing living expenses are rapidly driving up the price of a "comfortable" retirement.

If you are worried about your financial future, you are not alone. Nearly 50 percent of the current work force believes that what they are saving will not be enough.

Most Americans are questioning the "security" of Social Security. The declining value of Social Security is also adding pressure to retirement planning. What was once a "secure" retirement resource is now surrounded by uncertainty.

Retiring at the wrong time
Retiring at this time is causing problems due to lost values in pensions and IRAs.

One of the most appealing features of a pension is that it guarantees lifetime income, regardless of when you retire or what happens in the market.

Unfortunately, the same is not true for your retirement savings that are tied to the market, such as 401(k) and IRA rollovers.

Financial experts call it the fragile first decade if your portfolio suffers market losses in the first ten years, and the chances of it lasting over a 30-year retirement are greatly diminished.

Don't depend on luck
A variable annuity with an optional rider called a Guaranteed Minimum Withdrawal Benefit can provide important features to help you remove luck from your retirement strategy.

A VA is a long-term contract between you and an insurance company that combines investment and protection features into one retirement vehicle. A variable annuity can help you:

n Build retirement assets through a diversified portfolio of professionally managed investment options.
n Create a predictable and sustainable stream of retirement withdrawals.
n Protect your remaining assets through a death benefit.
n Grow retirement assets on a tax-deferred basis.
n Guarantee growth of assets and step up options for increasing your future lifetime income.

Contact your financial advisor and discuss your retirement goals and planning to see if a variable annuity fits what you want for protecting and growing your retirement plan.

Review the different products offered as they vary in plans and GMWB's offered.

Jim Lentini, CLU, ChFC, IAR is President of Lentini Insurance & Investments, Inc. He can be reached at (661) 254-7633. His column reflects his own views and not necessarily those of The Signal.


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