Our client the Alliance for Lifetime Income (ALI) recently announced a new retirement planning tool. The Check off the Basics approach to protecting your income helps you think about retirement income planning relative to your expenses.
The first step is to understand how much income you need to cover your essential monthly expenses, such as your mortgage or medical expenses, utilities, groceries, gym fees or car payments. Step two is finding ways to help cover these expenses with protected lifetime income from an annuity – income you count on receiving every month, for the rest of your life, to help cover the gap that Social Security leaves. When you Check off the Basics, you can use the rest of your savings to enjoy the retirement you want.
ALI’s easy-to-understand guide [PDF] has a simple worksheet to get you started on determining your essential expenses, and how an annuity can help cover them.
A deeper dive into the approach, in this article, reports that annuity owners are more confident and feel more freedom to spend and invest.