Creating Your Personal Pension
Solving the Longevity Equation
If you ask a room full of retirees what their biggest financial fear is, the answer is rarely “missing out on a stock rally.” It is almost always: “running out of money.” With advances in healthcare and technology, retirement can now last twenty-five, thirty, or even forty years. This “longevity risk” creates a complex math problem: How do you make a finite pile of savings last for an indefinite period of time?
Richard Goodwin specializes in solving this equation. At Goodwin Insurance & Associates, we shift the focus of your retirement plan from “Return on Investment” (ROI) to “Reliability of Income.” We believe that a successful retirement is not defined by the size of your asset column, but by the stability of your monthly cash flow. Since fewer companies offer traditional defined-benefit pensions today, we help you build your own “Personal Pension” using guaranteed lifetime income strategies.
The Mechanics of Lifetime Income Riders
To achieve this, Richard utilizes advanced financial tools known as income riders, which are attached to specific annuity contracts. These riders function separately from the cash value of your account. They grow at a guaranteed rate—often higher than current market interest rates—specifically for the purpose of calculating your future income check.
When you decide to trigger your income, the insurance company is contractually obligated to pay you a set amount every month for the rest of your life. It does not matter if you live to be 105; the checks will continue. It does not matter if the stock market goes to zero; the checks will continue. This transfer of risk—from your shoulders to the balance sheet of a multi-billion dollar insurance carrier—is the only way to replicate the security of the pensions that previous generations enjoyed.
Combating Sequence of Returns Risk
Relying on withdrawals from a stock portfolio for income is dangerous due to “Sequence of Returns Risk.” If you retire just as the market dips and you are forced to sell shares to pay for your living expenses, you cannibalize your principal. You are selling low to pay bills, which accelerates the depletion of your nest egg.
By using a guaranteed income strategy for your essential expenses—your mortgage, utilities, taxes, and groceries—you insulate yourself from this risk. Your basic lifestyle is funded by contract, not by market luck. This allows any remaining assets you have in the market to fluctuate without affecting your standard of living, giving them time to recover from downturns without being liquidated prematurely.
Inflation and Spousal Protection
A fixed income is great, but a fixed income that grows is better. Richard is acutely aware of the threat of inflation. A dollar today will not buy the same amount of goods ten years from now. Therefore, we design income plans using indexed products that offer the potential for increasing payouts. If the market performs well, your income check can get a “raise,” helping you maintain your purchasing power throughout your retirement.
Furthermore, we plan for the surviving spouse. Standard pensions often reduce or disappear when the pensioner passes away, leaving the surviving spouse in a financial crisis. Richard structures these personal pension plans with “Joint Life” payouts, ensuring that the income continues uninterrupted for as long as either of you is alive.
The Freedom of Certainty
Ultimately, Guaranteed Lifetime Income Planning is about freedom. It is about giving you the permission to spend your money. When you know that a check is coming next month, and the month after that, forever, you can spend your discretionary money on travel, hobbies, and grandkids without guilt. You don’t have to hoard every penny for a “rainy day” because the weatherproofing has already been installed.
Richard Goodwin brings forty-five years of perspective to this planning process. He helps you determine the optimal age to turn on income, how to bridge the gap until Social Security maximizes, and how to layer different income sources. By turning your savings into a paycheck, we provide the ultimate luxury in retirement: certainty.