Best Practices for Retirement Income – hosted by Wade Pfau
As the baby boomers reach retirement, advisors must solve new problems for clients. As clients shift their focus from maximizing wealth to creating sustainable retirement income, clients face a greater range of risks, and clients increasingly must solve a complex lifetime financial problem. Key retirement risks include longevity risk, market and the newly emergent sequence of returns risk, and personal spending shock risks. Each risk requires different income tools and risk management techniques. Two distinct schools of thought have emerged within the retirement income world: probability-based approaches and safety-first approaches. This presentation considers how different retirement income tools can be combined to build more efficient retirement strategies in a way that best integrates aspects from both schools of thought.
In this one-hour session, you will:
• Differentiate between the accumulation and distribution phases of retirement planning
• Understand key retirement risks
• Survey the retirement tool landscape with respect to investments and/or insurance.
Wade D. Pfau, Ph.D., CFA, RICP, is the curriculum director of the Retirement Income Certified Professional designation and a Professor of Retirement Income at The American College of Financial Services in King of Prussia, PA. He is also a Principal and Director for McLean Asset Management. He holds a doctorate in economics from Princeton University and publishes frequently in a wide variety of academic and practitioner research journals on topics related to retirement income. He hosts the Retirement Researcher website, and is a contributor to Forbes, Advisor Perspectives, Journal of Financial Planning, and an Expert Panelist for the Wall Street Journal. He is the author of the books, Safety-First Retirement Planning: An Integrated Approach for a Worry-Free Retirement, How Much Can I Spend in Retirement? A Guide to Investment-Based Retirement Income Strategies, and Reverse Mortgages: How to Use Reverse Mortgages to Secure Your Retirement.
Register HereHow to use Reverse Mortgages to Secure Your Retirement – Wade Pfau
Wed, May 20, 2020 11:00 AM – 12:00 PM PDT
In the early days, reverse mortgages were generally treated as a last resort option after other resources were depleted, or as a way to obtain quick access to a large lump-sum of assets. This is not the appropriate way to think about reverse mortgages in a retirement income plan, especially in light of recent research. The reverse mortgage option should be viewed as a method for responsible retirees to create liquidity for an otherwise illiquid asset, which in turn can create new options that potentially support a more efficient retirement income strategy (more spending and/or a greater legacy).
After providing an overview of retirement income planning, which sets the context for understanding the potential role of reverse mortgages, this presentation explains the basics for how reverse mortgages work. I then provide an overview of potential uses for a reverse mortgage, while focusing on ways to coordinate the line of credit use with distributions from the investment portfolio, and how to think about the reverse mortgage line of credit as a form of insurance to protect against market losses or declines in the home value. Financial advisors must pay attention to their client’s home equity, as this is a vital asset that can be used as part of a coordinated strategy to improve retirement outcomes.
About the Speaker:
Wade D. Pfau, Ph.D., CFA, RICP, is the curriculum director of the Retirement Income Certified Professional designation and a Professor of Retirement Income at The American College of Financial Services in King of Prussia, PA. As well, he is a Principal and Director for McLean Asset Management. He holds a doctorate in economics from Princeton University and publishes frequently in a wide variety of academic and practitioner research journals on topics related to retirement income.
Register HereEstimating the True Cost of Retirement – Presented by David Blanchett
Retirement is the most expensive “purchase” faced by most individuals… In order to properly forecast the value of assets during retirement, it is important to consider several other variables when estimating a person’s total retirement liability, such as their optimal replacement rate, their forecasted retirement period, and what it truly means to fail (or succeed). Retirement professionals need to have a framework for understanding and projecting retirement costs for each client, and a process for better estimating the true cost of retirement.
In this one-hour session, you will learn:
· Gain a better understanding of the key variables required to estimate the cost of retirement
· Learn of a more effective approach for calculating an income replacement rate
· Learn of a better spending model to help you understand how expenses tend to change throughout retirement and the implications of these changes on the retirement need
· Explore how efficient accumulation portfolios are not the same as efficient retirement portfolios
About Our Speaker:
David M. Blanchett, PhD, CFA, CFP® is head of retirement research for Morningstar Investment Management LLC, where he helps develop and maintain methodologies relating to wealth forecasting, general financial planning, automated investment selection, and portfolio assignment. He has published over 100 papers in a variety of industry and academic journals.
David is currently an Expert Panelist for the Wall Street Journal, an Adjunct professor of Wealth Management at The American College, a member of the Executive Committee for the Defined Contribution Institutional Investment Association, and a member of the ERISA Advisory Council.
Register Here
