Tag Archives | income risk

Looming Government Pension issues impacts everyone!

Looming Government Pension issues impacts everyone!

Looming government pension issues at the State and Local levels impact not only current government employees, but retirees and taxpayers alike. Many have seen the National Debt Clock. However, this is only U.S. Treasury debt – which doesn’t include agency debt, unfunded liabilities of Social Security and Medicare, State and Local debt, some student education […]

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Investing long term? Don’t overlook the inflation factor.

Even a low inflation amount can lead to loss of purchasing power over the long term. So investing (not savings – see last week’s post) is for the long term because investing also should overcome this insidious effect. Savings typically fall victim to inflation, while prudent investing does not. Here is a short article on […]

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What is the difference between Disability and Long Term Care insurances?

            Disability usually covers lost salary or wages. Long Term Care means convalescent care (not acute care that is covered by health insurance or Medicare/Medicaid/Medi-Cal). Insurance addresses the issue of WHO is going to pay the expenses should the condition occur. No insurance means your assets do. 0812 differencedisability from […]

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Replacing lost income … how?

Life insurance replaces lost income when you go below the ground. Lost income to who? To those who depend on that income (which is now lost). In general, retirees don’t need life insurance UNLESS their pension or Social Security is depended upon by the survivor. In general, if nobody else depends on your income then […]

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Latest research into sustainable retirement distributions

A structural problem with pensions, annuities, and first generation “safe withdrawal rate” methodology, is a disconnect of benefits paid (fixed or fixed with COLAs) from the underlying asset values required to support those promised benefits. Underlying asset values supporting retirement in any scheme are variable and may decrease in value, temporarily or permanently, due to market […]

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monthly payments

Take the Pension? Or the lump sum offer?

Pensions, for most people, are rare these days. Sometimes pension plans offer a lump sum to covered employees in lieu of a monthly payment. There are pros and cons when you need to decide the choices that are offered.   There are risks either way. As with anything involving risk, diversification is the prudent path to […]

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total return

Retirement Income is a process, rather than product.

Most people think of their investment portfolio as “principal,” “dividends,” “interest,” “capital gains,” etc. However, this view looks at money as if money knows where it came from. Money is fungible (fungibility), it is interchangeable and does not “know” its source. Another common perception is the need to protect principal and live off of dividends […]

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windy trail

How scared should you get?

Many people I’ve talked with confuse the term risk with the term volatility. Risk refers to YOU. Volatility refers to your portfolio.   Let’s go trail riding. Which trail is riskier to YOU if you fall down?   Both trails wind their way from here to there. How wiggly the trail is represents volatility in my metaphor. A […]

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