I am sure you have read this statistic by now. Beginning in January 2011 every single day more than 10,000 baby boomers will turn 65 for the next 19 years. Please Click Here To See The Article. That is a staggering number. What does an advisor need to do to prepare to be an expert in serving the income distribution needs of retirees? Step one, as simple as it seems, and even more important than marketing to retirees is selecting a distribution philosophy.
Income distribution philosophies tend to fall into one of three categories (1) Buy a product designed to produce guaranteed lifetime income (2) Implement a systematic withdrawal plan from an asset allocation portfolio (3) Use a time segmented strategy.
An advisor needs to determine which philosophy they believe in and then take steps to make sure they can efficiently implement the strategy across their retiree client base. We conducted an in depth analysis of these three strategies in our award winning white paper Capturing the Income Distribution Opportunity. Click below to review our paper and see why we strongly recommend a combination of lifetime income products with a time segmented strategy.
In an upcoming post we will tackle the all important question of determining how much of a retiree's income should be guaranteed.