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Is the Future Bleak for Retirees?

The Principle:

How do you prepare for the future, even with low interest rates? How much do you really need in retirement? 

Honest Takes:

In a recent letter to shareholders, Warren Buffett warned that retirees are facing a bleak future due to historic low interest rates. What does Brian think?

Bonds aren’t keeping up with inflation. So, if you want to keep it safe, what do you do? Brian shares that his wealthiest clients are his most conservative. If you look at wealthy investors, you might be surprised to see the types of accounts they have. Their returns might be low, but they know they get to keep their money.

You have to have some money in safety. If you have a certain amount of income needs, a few years of that portion should be incredibly conservative in case the market crashes. A lot of people struggle when they don’t know what they truly need in retirement.

What are your monthly expenses? What money do you plan to spend per year, including the fun stuff? Where will that money be generated from in retirement? This needs to be included in your retirement plan so that you are able to have the right amount of money in safety and the right amount in growth.

Furthermore, don’t forget about the role taxes plays in your financial plan. If your investing strategy doesn’t mesh with your tax strategy, that means you don’t have a plan. Talk to your financial advisor and your CPA about which accounts will help you create the right strategy for your retirement plan and your future.

Listen to the entire episode or click on the timestamps below to skip ahead.

[0:12] – What was in Warren Buffet’s shareholder letter?

[1:48] – Who are Brian’s wealthiest clients?

[4:51] – Where will your retirement income come from?

[7:38] – What’s your tax strategy?

Today’s Truth:

“It’s a bleak future for the future of taxes, because it’s going up and no one has a plan for it.”

Brian Bowen

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The Host:

Brian Bowen – Contact