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How You Can Prepare for Retirement During Your 70s
Published July 30, 2017
After working and saving for so many years, it’s finally time to retire. Here’s a quick to-do list to make sure you’ve done everything to prepare.
- If you haven’t bought a lifetime income annuity, it’s not too late to do so
- If you don’t need your full RMD distribution, consider utilizing a QLAC
- Don’t be afraid to add risk back into your portfolio
With retirement right around the corner it’s important to see that you’ve reached all of your goals. We created this quick checklist to make sure you achieve these goals during your 70s.
- It’s not too late to protect against longevity risk. Eliminate some uncertainty about how long your money will last through the purchase of an immediate annuity (also known as a Single Premium Immediate Annuity or SPIA). An immediate annuity converts a lump-sum purchase into a steady, guaranteed paycheck that will last as long as you’re alive. With an immediate annuity, you’ll begin receiving income immediately.
- Defer your RMDs if you don’t need them. By now the required minimum distribution (RMD) rules will be in effect for your IRA and 401(k). If you don’t need the full distribution now and are burdened by their associated taxes, think about using a Qualified Longevity Annuity Contract (QLAC) to defer a portion of them to as late as age 85.
- Consider adding risk to your portfolio as your future spending needs decline. Depending on how much you have saved relatively to your future withdrawal needs, think about increasing your portfolio percentage in stocks. Exposing yourself to market upside again works particularly well if you’ve already created a guaranteed income for yourself to cover basic expenses through an income annuity.
- Enjoy yourself. You’ve worked hard to make it here, and if you’ve been planning and saving along the way, you can reap the rewards of a comfortable, happy retirement. Use the extra spending money you’ve saved and take that vacation.