Morningstar recently released its annual report on the state of retirement income. It’s the fourth such annual report. In each, Morningstar uses assumptions about future market returns and inflation to estimate the safe withdrawal rate (SWR). In this year’s report, Morningstar estimates that the SWR is 3.7%. This means that one could spend 3.7% of…
When it comes to saving for retirement, there are four account types to consider: The different account types raise an important question about saving for retirement–Does the order in which we fund these accounts matter? In many cases, it does. In this article, we’ll walk through an optimal order of funding retirement accounts. We’ll also…
The cost of financial advice and how that cost is calculated are hotly debated topics among financial professionals and the clients they serve. The most common fee structure is based on Assets Under Management (AUM). An advisor charges a client an annual fee equal to a percentage of the amount of investments they manage for…
Fee-only financial advisors are often touted as the most transparent and unbiased option for investment advice. They do not earn commissions and have a fiduciary duty to act in their clients’ best interests. However, even fee-only advisors have hidden costs and conflicts that can chip away at your investment returns over time. 1. The True…
You enter your income, expenses, investments and liabilities into your favorite retirement planner. You click a button, the software does some kind of calculation, and out pops a single number. It may be 87%. Maybe it’s 72%. Or it could be 15%. Whatever the number, you’re told it represents your retirement plan’s “Chance of Success.”…
Estimating the future returns of your investments is a key part of most retirement plans. It can help us understand our plan’s chance of success, but it can also be the most challenging. In this article, I’ll walk through my approach along with the tools and resources you can use in your own retirement plan….