Determining a Client's Retirement Income Style

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Advisors must solve new problems for clients who aim to sustain their lifestyle over an unknown horizon. Multiple retirement income strategies have emerged and it is hard for retirees to identify which strategies match their personal style. This presentation is based on research that identifies and validates a set of scorable retirement income factors to define preferences for an overall retirement income style. It describes a workable retirement model by showing how the factors connect to four main retirement income strategies: systematic withdrawals with total return investing, risk wrap with deferred annuities, protected income , and time segmentation.

Identify various approaches taken for retirement income strategies.
Explain underlying retirement income factors which uncover retiree preferences that coalesce into a retirement income style.

Link retirement income styles to existing strategic approaches for retirement income that satisfy retiree preferences.

Competency Level: Intermediate

FPA Competency: Critical Thinking

CFP Board Topic: Intermediate, Retirement Savings and Income Planning

CFP Board CE Credit Hours: 1

Wade D. Pfau, PhD, CFA

Professor

The American College of Financial Services

Wade D. Pfau, Ph.D., CFA, RICP, is the program director of the Retirement Income Certified Professional designation and a Professor of Retirement Income at The American College of Financial Services in King of Prussia, PA. As well, he is a Principal and Director for McLean Asset Management. He holds a doctorate in economics from Princeton University and has published more than sixty peer-reviewed research articles in a wide variety of academic and practitioner journals. He hosts the Retirement Researcher website, and his most recent book is Safety-First Retirement Planning: An Integrated Approach for a Worry-Free Retirement.