Retirement Income Strategy for 61 Year Old With $1,200,000 || Social Security & Roth IRA Conversion
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In this video I want to go through a Retirement Income Strategy for a 61 year old with $1,200,000 in retirement savings and retirement investments. In this retirement strategy, the couple is asking “Can I Retire”, but also asking, “when should we collect our social security benefits,” and “what about taxes?” Social Security benefits claiming strategies ( are essential to anyone’s retirement planning and need to be carefully planned out. TAXES are also a HUGE component to a retirement planning strategy and need even more attention than Social Security (
Retirement income strategies and retirement income planning are two big pieces to anyones retirement planning calculator. Whether you are wanting to know strategies for “retirement planning at 30″, “retirement planning at 40″, “retirement planning at 50″, or even “retirement planning at 60″ understanding how much retirement income that you want versus how much you need gives you a roadmap to follow to and through retirement.
Here at Pearl Wealth Group, we run a trademarked retirement investment and retirement income plan for individuals and families who are wanting to retire called “Your Financial EKG™.” What we are trying to visualize is how long a persons retirement savings are going to last throughout retirement. If you are looking for early retirement planning tips or trying to saving for retirement in your 50’s, You Financial EKG™ is a great tool to help you understand where you are retirement planning. retirement planning and retirement income strategies shouldn’t be complicated. They should just be done right.
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Pearl Wealth Group
Drew Blackston, CRC® & RFC®
Office: 813-807-5060
Info@pearlwealthgroup.com
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Retirement is a significant milestone in one’s life that requires careful planning and consideration, especially for individuals nearing their golden years. For a 61-year-old with $1,200,000 saved for retirement, it’s crucial to develop a sound income strategy to ensure a comfortable and worry-free retirement. This article aims to shed light on the retirement income strategy for such an individual, including insights into Social Security benefits and Roth IRA conversions.
1. Assessing Retirement Goals:
The first step in creating a retirement income strategy is to evaluate your financial goals and aspirations. Determine your desired lifestyle, expenses, and potential healthcare needs during retirement. This assessment will provide a clear understanding of how your $1,200,000 savings should be allocated to meet these objectives.
2. Social Security Benefits:
As a 61-year-old, you may be eligible to start receiving Social Security benefits, which can provide a stable source of income during retirement. However, keep in mind that claiming Social Security before reaching full retirement age (typically around 66-67) will result in reduced monthly benefits. On the other hand, delaying benefits beyond full retirement age can increase your Social Security income. Consider consulting a financial advisor to determine the optimal age to claim Social Security based on your circumstances.
3. Portfolio Allocation:
Determining the appropriate allocation of your $1,200,000 savings between stocks, bonds, and other investment vehicles is essential. Generally, at this stage, a more conservative approach is advisable to protect your nest egg and minimize potential losses. Allocating a significant portion to fixed-income investments can provide stable income and reduce overall risk. However, maintaining a balanced mix between growth-oriented investments and income-generating assets is crucial to preserve your purchasing power over a potentially lengthy retirement period.
4. Roth IRA Conversion:
Considering a Roth IRA conversion is another smart strategy for retirement planning. A Roth IRA offers unique benefits, including tax-free withdrawals during retirement. By converting a portion of your traditional IRA assets into a Roth IRA, you can potentially reduce future tax burdens. However, individuals should be cautious about the tax implications of such conversions and consider their short-term and long-term tax outlook. Engaging with a tax advisor or financial planner can help assess the most advantageous and tax-efficient conversion amount for your situation.
5. Developing a Sustainable Withdrawal Plan:
To create a consistent income stream during retirement, you would need to establish a sustainable withdrawal plan. Aim to withdraw around 3-4% of your portfolio each year to strike a balance between maintaining a satisfactory level of income and avoiding early depletion of your savings. Adjusting for inflation is also critical to preserve your purchasing power over the years. Furthermore, factor in other potential income sources, such as annuities or rental properties, to supplement your retirement income.
6. Reevaluation and Monitoring:
Retirement income strategies should not be rigid and inflexible but instead adapt to changing circumstances. Reevaluate your income strategy periodically, especially in the early years of retirement, to ensure it continues to align with your needs and aspirations. Monitor your investments, reassess your Social Security claiming strategy if necessary, and consider adjustments based on evolving market conditions or personal circumstances.
In conclusion, crafting a comprehensive retirement income strategy is crucial for a 61-year-old with $1,200,000 in savings. Assessing retirement goals, optimizing Social Security benefits, strategically allocating assets, considering Roth IRA conversions, establishing a sustainable withdrawal plan, and regularly reassessing the strategy are key steps toward a fulfilling and financially secure retirement. Consulting with a qualified financial advisor can provide invaluable guidance and expertise in this critical stage of life.
*To schedule your virtual retirement and investment consultation with Drew, please select a day & time that works best for you: https://calendly.com/pearlwealthgroup/discoverycall *
one main issue with taking social security early for couples is if the higher earner takes it early then dies, the survivor benefit will be less
States without income taxes have regressive taxes on everything you purchase. They are no utopia. Yea let's live in Texas where the libertarian power grid collapses all the time.
What is it with all these analyses that always include pension money. Most people don't have pension money. I tuned in to listen to how couple with 1.2 million can retire yet now they also have thousands in pension money as well.
Lost me when you went to computer
Does the 1.45% increase in the Fed tax apply to the entire balance or not just the 30K added?
And what is your fee?
Beans and rice. Rice and beans.
Couple things…..you never told us what they need to live on in retirement. And secondly, you did not include their SS income in your plan? You specifically focused on him taking his SS next year at 62 and her taking hers at 65, in 6 years. But you never included the SS income in the planning or how it will affect their taxes— especially during Roth conversions when between them they are adding $3900/month or $46,800/year of additional income. Or did I miss something?
Another great video. More people need to subscribe to his channel!!!
Great video! I don't notice where you specified amount of CA tax on the conversion. If he was in 8% CA bracket, how would you calculate the extra for state tax?
I always love when people who are worth over $2 million dollars and have a pension wonder if they can retire! So many retire on much much less!
Come on Drew, u never said how much they need to live on! U gotta start there. Scary u are giving advice on this subject! Seriously! Part of the problem with advisement.
Move out of your idiot state and things will be a ton better.
Hey bud why don’t you get a real job instead of sucking off your clients money. Here I have a dollar. Way more than you’re worth.
When calculating social security, did you consider COLA in your calculation? That can add significant more money by waiting and letting that COLA compound.
Instead of the man claiming Social Security at 62. Why wouldn’t you have him spend his 401(k) down and claim Social Security later? His guaranteed rate of return on waiting to claim Social Security would be far more efficient in my opinion.
Nice video. Subscribed. Quick questions – is the conversion mentioned from traditional to roth? How did the asset became more than a million in the end? Did they invested the money they withdrew? Can withdrawn money be reinvested? Thank you.
Good video Drew 🙂 I would do more than 30k conversion and of course move outta Cali when the wife retired to TX, TN or FL, but thats me 😛
In your evaluation of social security do you factor for the possibility that benefits may be reduced as much as 25% around 2033 when the trust fund is depleted? If a guy starts his social security now then he could get 10 years of full benefit before any reduction.