SOWBO Magazine 2nd Edition

With people living longer than ever, it?s
important to make sure the money you have set
aside will last the rest of your life. While Social
Security provides a lifetime supply of income, it
may not be enough to support your desired
lifestyle. If you think you?ll need additional
income and do not have a pension, a lifetime
income annuity can be an excellent way to make
up the difference.
Florence Norville-Cheek
Have you ever heard of the ?three-legged stool?
of retirement? If you have, it probably was a
while ago. Once considered the ideal retirement
model, the three-legged stool has fallen out of
favor because one of the legs? defined benefit
pensions? is not as stable as it once was, and
the future of Social Security is often wound up in
political maneuvering in Washington. Consider
the following:
According to the Bureau of Labor Statistics, just
48% of private sector employers offer defined
contribution or defined benefit pension plans,
and only 8% offer traditional defined benefit
plans,1 thereby eliminating a guaranteed source
of lifetime income.
? Social Security benefits replace about 40% of
the average worker?s salary.2 What?s more, the
Social Security trust fund is expected to deplete
its reserves by 2034, and will be able to fund
approximately 75% of benefits after that.3
Fortunately, there are ways to reinforce the third
leg of the stool? retirement savings and other
personal assets? so that you can still enjoy a
long and fulfilling retirement. Here are two
proven funding sources you may want to
consider if you need to compensate for any
shortcomings:
Although the primary purpose of life insurance
is to deliver death benefit protection, many
permanent life policies accumulate cash value. If
your need for protection decreases over time,
you can borrow against this cash value? tax-free
in most cases? and use the money to
supplement your retirement lifestyle. (Loans
against your policy accrue interest and decrease
the death benefit and cash value by the amount
of the outstanding loan and interest.)
While the three-legged stool of retirement may
be a bit wobbly, the good news is that a secure
future is still within reach. The main difference
these days is that you will most likely have to
build it yourself.
Florence Norville-Cheek, MBA Agent /
Regist ered Represent at ive, New York Life
Insurance Company/NYLIFE Securities 555 East
City Avenue, Bala Cynwyd, Suite 800, PA 19004
1 ?Employee Benefits Survey: Retirement
Benefits,? Bureau of Labor Statistics, March
2017.
2 ?Retirement Planner: Learn About Social
Security Programs,? Social Security.
3 ?Status of the Social Security and Medicare
Programs: A Summary of the 2017 Annual
Reports.? U.S. Department of the Treasury.
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