Brian Saranovitz Featured in Forbes
Brian Saranovitz, co-founder of Your Retirement Advisor, was featured today in a Forbes.com piece by Kerri Zane entitled “Here’s How To Refresh Your Retirement: The 4% Rule of Thumb”, regarding the theory that dictates how much you can safely withdraw from your retirement savings account each year and still have a nest egg to last the rest of your lifetime.
Many advisors, including Brian, think that while it’s a good rule of thumb, it doesn’t address issues such as increasingly high healthcare costs, longer life expectancies and jobs that are sustainable throughout old age. “The 4% rule in today’s market environment, a traditional 60/40 stock/bond portfolio, could result in portfolio failure,” Brian explains. He continues, “The yields on bonds are at historic lows and 4% is simply too much draw on the portfolio. A safer rule of thumb, when employing a 60/40 portfolio, is 2-3%.”
For that reason, Your Retirement Advisor has developed the a multi-discipline retirement strategy (or MDRS) based on a combination of globally diversified stocks and high-quality fixed indexed annuities that offers growth with protection, a combination critical as one approaches retirement. Brian advises that it should also be coupled with a S.W.I.P (systematic withdrawal income plan) and a buffer strategy in times of severe stock market losses. In addition, an effective tax reduction strategy can potentially raise a retiree’s safe withdrawal rate even higher. YRA’s MDRS “allows either a higher withdrawal rate or a sustained source of income for life,” he explains.
In addition with Brian’s own analysis and decades of experience as an advisor, MDRS is also based on leading retirement research from several retirement academics and economists. MDRS relies on data-driven retirement projections utilizing sophisticated software that show a client how the mix of stocks and annuities, in both negative and positive market environments, can support the 4% safe withdrawal rule and allow a retiree to sustain income for life. Further details on this strategy can be found in our white paper, Retirement Portfolio Design for a Changing Economy.
To learn more about the 4% rule, or how our multi-discipline retirement strategy can best help you, shoot us an email at
info@yourretirementadvisor.com at
