January 24, 2008: Planning for retirement income in Illinois

We are seeing the beginning of a major shift in financial planning in Illinois. The past 10 years have been a period of major accumulation of investment assets for capital gains and growth by baby boomers in Illinois, while the next 20-30 years will see a shift of investment assets toward income. In other words, Illinois baby boomers have been saving up for retirement. Once they retire, they will need to invest for income.

How do you do that? Well, some people retiring today have pensions which will support them. However, most people who are soon to be entering retirement in Illinois will have to work with a financial planner to create their own "retirement paycheck". This often means a combination of Social Security, having a plan to sell and spend a portion of their investment accounts, and the purchase of annuities which can provide a guaranteed lifetime income.

Your current age, your spending, and your planned retirement age have major impacts on how much you will need to support your retirement. An Illinois financial planner or investment advisor can work with you to analyze your financial plan. After meeting with their advisor, many people realize they should change part of their plan, like working a little longer or spending less. Others will be able to work with their Illinois financial advisor to plan for leaving an inheritence to their family or charities. Younger savers can also benefit, by looking at the various savings "buckets" (401k, IRA, Roth IRA, taxable accounts, etc) you are using for retirement income.