Distribution Planning - Part 1

June 08, 2022

Hi, my name is Chris Beale. I am a senior advisor and founder of New England Capital Financial Advisors.


Today I want to talk about one of my favorite topics, Distribution planning. The covid Pandemic has caused many employees to rethink working. How they work; at a business or office environment or vs. remotely. How long they work; full time, part time, until age 67 (typically full retirement age for social security) vs 62 (the minimum age to start social security) or immediately regardless of their age. They’re also rethinking why they work. Is what they do meaningful, rewarding, & beneficial to themselves and society at large?


These questions caused what has been called “the great resignation” or “great reset” or “great reimagination”. As a result of this “great resignation” many people have left their jobs or at least thought enough about it to ask for our help. And we have helped many of you by exploring whether you could possibly retire, change jobs, or reduce your hours and income from your wages.


With our experience and expertise, we have been able to show our clients different scenarios and options of resigning, retiring, reducing & reimagining their lifestyles.


Our financial planning techniques include uncovering alternative income sources and capital. Then we can show how we create flexible income streams from the capital you have created during your working years.


This transition is an exciting and scary time. We understand this. We also understand that the tools, techniques, and strategy used during the accumulation years are very different than the tools techniques and strategies we will use for you as you transition from the accumulation phase to the distribution phase of your life.


Unfortunately, not all financial planners or clients understand this. In my 39 years of experience, I have seen this lack of understanding between how to manage money during accumulation years and distribution years manifest in many ways. Most commonly some financial planners, many are non-fiduciary, financial salespeople will use costly and inefficient products during the accumulation phase and costly, expensive, and inflexible products during the distribution phase of life.


In my next blogs I’ll continue the distribution discussion by explaining the 4% rule of distribution planning, and how we are rethinking this time-tested rule in our planning process. I’ll also discuss increased longevity and the planning problems associated with living longer. The Current market and economic conditions and a longer retirement time frame can affect your successful financial outcomes. As clients are retiring earlier and we are all living longer than any generation in history it may not be unusual for you to spend more years in retirement than you did in your working years.


As always, call us if you have any questions or want to review how to plan for your retirement.  I look forward to talking with you soon.