Sprouse Financial - Rodger Sprouse - Lee's Summit, MO
  • Home
  • About
    • Methodology
    • Press
  • Philosophy
    • Retirement Income Strategies
    • Tax-Efficient Solutions
    • Investment Planning
    • Long-Term Care
    • Estate Preservation
    • Securities
  • Resources
    • Calculators
    • Videos
    • Guides
  • Blog
  • Contact
  • 816.875.4646

Blog

Will Your 401(k) Funds Last Through a Long Retirement?

6/22/2017

0 Comments

 
Picture
​Does a significant portion of your retirement assets exist within your 401(k) plan? If so, you’re not alone. Many workers use their 401(k) as their primary retirement-saving vehicle for a number of reasons. You get tax-deferred growth inside a 401(k) plan. You also may get matching contributions from your employer. Those two components can make a 401(k) a powerful accumulation vehicle.
 
Retirement isn’t only about asset accumulation, though. You certainly need to save a substantial amount of money to fund a long retirement. However, you also need to make that money last. Your retirement could last several decades. If you aren’t disciplined with your spending and money management, your 401(k) funds may not last the long haul.
Below are a few tips to help you develop a 401(k) plan that’s built to last. If you are approaching retirement and haven’t considered your distribution and spending strategy, now may be the time to do so. Without a plan in place, your assets may not last through the later years of retirement.

Limit your withdrawal amount.
One of the most effective ways to preserve your 401(k) assets is to limit the amount you withdraw each year in retirement. When you first retire, you may have more money and free time than you’ve ever had in your life. It could be tempting to spend money on travel, shopping, dining out, hobbies and other costly activities.
 
Instead of taking money as you need it, calculate a conservative withdrawal rate and stick to that amount. Ideally, you want to withdraw enough to meet your needs but also leave as much in the plan as possible. The more money you leave in the plan, the greater your ability to continue to grow your assets. A financial professional can help calculate the most appropriate withdrawal rate for you.

Budget for taxes.
Remember that distributions from a 401(k) plan are taxable. That means you should account for those taxes in your budgeting and your distribution planning. It may be helpful to analyze all your accounts and income, and then map out the order of distributions that’s most tax-efficient.
 
For instance, you may have assets across 401(k) plans, IRAs, Roth IRAs and even fully taxable accounts. You also may have income from Social Security, pensions and other sources. Work with your financial professional to project the tax consequences of utilizing those sources for retirement income. You may find that it’s more tax-efficient to delay 401(k) distributions in favor of taking income from other accounts.

Look for ways to create guaranteed distributions.
One of the biggest challenges retirees face is the prospect of a retirement that lasts 30 years or more. It’s possible that you may spend more time in retirement than you spent saving for retirement. If your assets and income don’t last through retirement, you could face challenging circumstances in your later years.
 
One way to minimize the financial risk of longevity is with income that’s guaranteed to last through your lifetime. For example, Social Security and pensions often provide lifetime guaranteed income. Annuities can be another useful guaranteed income source. You might consider using some of your 401(k) assets to fund an annuity that provides income that’s guaranteed regardless of market performance.

Ready to develop your 401(k) strategy? Let’s talk about it. Contact us at Sprouse Financial Group. We can help you analyze your needs and develop a plan. Let’s connect soon and start the conversation.
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice.
16696 - 2017/5/23

0 Comments



Leave a Reply.

Picture
Click for the BBB Business Review of this Financial Planning Consultants in Overland Park KS

Navigation

Home
About
Philosophy
Resources
Blog
Contact

Contact

 306 SE 3rd Street
 Lee’s Summit MO 64063
Get Directions

Phone: (816) 875-4646
Fax: (888) 494-8007

This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation.
This website is for information purposes only and should not be regarded as an offer to sell or as a solicitation of an offer to buy any financial product. We do not represent that this information is complete or accurate and it should not be relied upon as such. All information is subject to change without notice. 

Securities and Investment Advisory Services offered through Titan Securities, member FINRA|SIPC. Titan Securities is a registered Broker/Dealer and Registered Investment Advisor.

Rodger Sprouse is a licensed representative of Titan Securities, doing business under the name of Sprouse Financial.    Sprouse Financial and Titan Securiites are not affiliated.

Titan Securities - 16775 Addison Road, Suite 202, Addison, TX 75001 - 972-980-5920

Investments are subject to suitability. Risk, fees and taxes may apply. Investment products are not FDIC insured, have no bank guarantee, and may lose value. Investments may contain a high degree of risk, may be considered speculative, and may result in the entire loss of the amount invested. Investments may incur substantial fees and expenses which are borne by the investor. Read prospectus carefully before investing. Sprouse Financial nor Titan Securities offers tax advice. Clients should consult a professional tax advisor for their tax needs.

Check the background of an investment professional. | Privacy Policy
  • Home
  • About
    • Methodology
    • Press
  • Philosophy
    • Retirement Income Strategies
    • Tax-Efficient Solutions
    • Investment Planning
    • Long-Term Care
    • Estate Preservation
    • Securities
  • Resources
    • Calculators
    • Videos
    • Guides
  • Blog
  • Contact
  • 816.875.4646