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We believe financial education is indispensable. Having the right information can empower you to act with clarity and confidence, and to ultimately live a more intentional and meaningful life.
Why Most Americans Aren’t Using the Best Approach to Guaranteed Lifetime Income
The following content is adapted from the book Tax-Free Income for Life by David McKnight. In a previous article, I shared how a single premium immediate annuity (SPIA) may be adept at addressing longevity risk in a far less capital-intensive way than the traditional stock market approach. What’s more, it confers a long list of psychological, mathematical, and longevity benefits that can smooth out an otherwise rocky road in retirement. If ever there were a compelling solution to consider for outliving your money, the SPIA makes a strong case. All this, of course, begs the question: If this income […]
Guaranteed Lifetime Income: Solving the Most Important Math Equation of Your Life
The following content is adapted from Tax-Free Income for Life, by David McKnight. There’s a massive X factor when it comes to retirement planning: you simply don’t know how long you’re going to live. You’re trying to solve the most important math equation of your life, and you’re missing the most important variable! That’s why longevity risk, as I’ve mentioned before, is every retiree’s most vexing concern. If you don’t make provisions for how long you’re actually going to live, then you could run out of money before you run out of life.
What You Need to Know About the Three Percent Rule
In a previous article, I discussed the retirement income challenges created by longevity risk. Today, I want to talk about a common strategy for addressing it: the Three Percent Rule. I’ll share what came before it, how it came to be popularized, and where it may fall short — including four significant shortcomings you should understand before relying on it as your primary withdrawal strategy. As I always suggest, I hope you’ll take notes as you read on any questions that come to mind. You can always reach out to me to schedule a discussion if you’d like to […]
The Retirement Risk Trifecta You Need to Know About
We are all living in — and retiring in — a risk-rich environment. Not only do you need to worry about tax rate increases and longevity risk, both of which I’ve written about previously, but there are other very real dangers to your long-term retirement outlook, too. In this article, I’ll review three of them: withdrawal rate risk, long-term care risk, and inflation risk. As you read, take notes on questions you may have, and please feel free to reach out to me to schedule a discussion if you’d like to learn more about how I can help you […]
Avoiding the Greatest Retirement Risks: Part Two
In my last article — part one of this two-part series — I shared an excerpt from David McKnight’s powerful book, Tax-Free Income for Life. In it, David detailed the first great retirement risk we’re all up against, which is tax rate risk. If you haven’t read that article yet, I encourage you to start there. Today, I’m sharing another excerpt from David as he explains the second great retirement risk — longevity risk. It’s my mission to educate you about this risk, but also to inspire you to take control of your financial future and prepare for the […]
Sequence-of-Return Risk and the ‘Risk Multiplier’ That Makes It Even More Dangerous
If you’ve read any of my previous articles, you know it’s my mission to educate you about the very real risks threatening to undermine your retirement outlook. Of course, I also want to empower you now, in the present, to take control of your money and prepare for what’s to come. This article is no different, as I’ll be sharing more about a threat lurking in your portfolio — sequence-of-return risk — and the risk multiplier that makes it even more dangerous. As you read, take notes on questions you may have, and please feel free to reach out […]
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Aligning Your Tax-Free Stars
The following content is adapted from the book Tax-Free Income for Life by David McKnight. If you’ve been reading the Hanson Wealth Management blog for a while, you know that we have previously discussed the advantages of the fixed indexed annuity (FIA). I have also shared two significant disadvantages: tax rate risk and Social Security taxation. Now, I want to look at a potential option for addressing these two risks, which can help you work toward aligning your tax-free stars.
Avoiding the Greatest Retirement Risks: Part One
My goal as a financial advisor is to give each of my clients a step-by-step plan for a well-prepared retirement. In order to do that, I have to help them avoid the two greatest retirement risks. The truth is that roadblocks loom large in retirement, and too many people find themselves living in fear of outliving their money. This is the reason I have dedicated my professional life to tax-free retirement planning through the philosophy of my mentor, David McKnight, a widely recognized voice on tax-free retirement and author of the eye-opening book The Power of Zero. Below, I […]
Tax-Deferred Retirement Plans: A Catch-22?
At Hanson Wealth Management, we believe our commitment to educating our clients is a cornerstone of what we do. The following content on tax-deferred retirement plans is partially excerpted from The Power of Zero, by David McKnight, and we believe you’ll find it eye-opening as you plan for a tax-efficient retirement. So many clients come through our doors having followed advice from voices in the financial world who tell them it’s okay to have all their assets in tax-deferred accounts because they’ll be in a lower tax bracket in retirement. Of course, this is a faulty assumption, and below […]
The FIA: A Tool for Overcoming Perceived SPIA Deficiencies
The following content is adapted from the book Tax-Free Income for Life by David McKnight. In this article, I want to address the topic of single premium immediate annuities (SPIAs). In past writings, I shared how the SPIA is an effective solution to address longevity risk and that it offers multiple benefits around lifetime income in retirement. I’ve also written about why so few Americans take advantage of the SPIA solution: lack of liquidity, lack of an inflation hedge, and the Mack Truck Factor. In this article, though, I’ll share how insurance companies have reacted to these three chief […]
Understanding Sequence-of-Return Risk and Longevity Risk
If you’ve read our previous articles, you know the Hanson Wealth Management team believes strongly in the power of financial education. Our mission with today’s topic is to educate you about several very real risks threatening to undermine your retirement outlook. Of course, we also want to empower you now, in the present, to take control of your financial future. Below, we share more content from David McKnight about a threat lurking in your portfolio — sequence-of-return risk — and the risk multiplier that makes it even more dangerous. As you read, take notes on questions you may have, […]
The Demographic Glitch That May Cause Your Taxes to Double
The Baby Boomer generation is well-known for being the product of the post-World War II baby boom, and for rejecting and redefining traditional values in many ways. However, did you know that the Baby Boomer generation also represents a “demographic glitch” in a way that is important to all of us? Allow me to explain.
Will an Oncoming ‘Tax Train Wreck’ Threaten Your Retirement?
At Hanson Wealth Management, we are committed to helping our clients achieve lives of meaning and purpose. What does that mean? Well, the specifics are different for everyone, but we believe every person’s strategy should include a comprehensive approach to financial planning. Most especially, it means having a retirement plan that takes into account the impact of potentially increasing taxes on your retirement distributions. Why is this so important? Well, to put it simply, there is a storm brewing that can put your retirement financial outlook in jeopardy: taxes are very likely to increase. In this article, we explain […]
Bring your Daughter to Work Day
We loved having a special guest in the office for Bring Your Daughter to Work Day! Lillian, Brian’s daughter, spent the day getting a behind-the-scenes look at what we do and quickly became part of the team. Lillian brought great energy and plenty of smiles along the way. Days like these are a great reminder of the importance of family and the opportunity to share what we do with the next generation—while making a few fun memories in the process.
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Schedule a strategy session with us today and learn what’s possible when you optimize your financial strategies and live a more empowered, purposeful life.