Investment portfolio
Income for the rest of the Clara and Eduardo’s desires will come from their portfolio – both from income-generating products but also periodically withdrawing some of their assets.
Preparing for retirement
The nervous nellies
Clara and Eduardo
Clara and Eduardo are nearing retirement and are financially stable, though nervous about market volatility.
| age | life stage | salary | total assets | occupation |
|---|---|---|---|---|
| Clara is 63 and Eduardo is 62 | Nearing Retirement | Clara: $83k Eduardo: $93.5k |
$750,000 | Clara: Teacher Eduardo: Physician's Assistant |
Situation
Clara is married to Eduardo. This is the second marriage for both Clara and Eduardo. Clara is a middle school teacher. The two met at a picnic for their church five years ago.
Family
Clara has three children from her previous relationship, and Eduardo has a child from his first marriage. All the children are out of the house, starting lives of their own.
Goal
Clara has a substantial Defined Benefit plan, as she has been teaching in her school district for over 20 years. They want flexibility in their investments as they have guaranteed income through Clara's plan.
Lifestyle
Clara and Eduardo have aspirations of taking a yearly cruise and spending several months a year traveling in their RV.
Objectives
Clara and Eduardo prioritize their retirement objectives as follows:
1
Want help deciding when they'll be able to retire
2
Want flexibility in retirement to ensure future travel and the ability to live "care-free"
3
Both expect to live into very old age as both have elderly parents
Concerns
Retirement risks that are of greatest concern to Clara and Eduardo:
Top concern
Longevity
Concern
Market
Clara and Eduardo's income plan
Clara and Eduardo have specific financial needs in order to be able to achieve their overall retirement goals. The following is an estimated amount of annual income* Clara and Eduardo believe they will need to achieve their retirement goals.
Basic needs
Housing, food, healthcare, emergency fund.
See how its coveredOpens dialog
Lifestyle
RV maintenance, travel, lifestyle support
Legacy
Legacy is not as important for Eduardo and Clara. They do like the idea of having a "buffer" in case they want to take a more expensive trip one year.
*Income needs in terms of after-tax income.
Clara and Eduardo's investment strategy
Investment portfolio
Eduardo and Clara will use their assets from their brokerage account, IRAs and Eduardo’s 403(b) and manage them in a moderate investment portfolio.
Resulting income
Hypothetical income approximations to maintain $94,000 of annual income
Displayed in real dollars to show income maintains the customer's buying power throughout retirement (30-35 years). The composition of income received in retirement is purely hypothetical, for illustrative purpose only.
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