As the holiday season approaches, many people start thinking about the perfect gifts for loved ones. But have you ever thought about how the services you provide can help retirees pursue the ultimate gift? Below are some ways you can help provide that gift to clients.
These gifts might not come wrapped in shiny paper, but they offer invaluable opportunities for a retiree’s future.
Imagine gifting a newly retired couple—both age 66—the confidence they need to create an income plan that spans over 25 years of retirement. In his book, “The Prosperous Retirement: Guide to the New Reality,” Michael Stein highlights the importance of planning for the three phases of retirement spending he has labeled the Go-Go, Slow-Go, and No-Go years.1 A well-thoughtout income plan may enable clients to participate in more activities and have potentially higher income during the period just after retirement, or the Go-Go years. As the Slow-Go years approach, managing income and having the resources to adapt the home to aging owners becomes essential. By contrast, the No-Go years are when retirees are expected to be less active due to aging or health conditions. This time should be for relaxation and reflection—spent in comfortable surroundings and free from financial worries. A long-term plan can be instrumental in cultivating clients’ confidence as they approach retirement.
Some of the most meaningful work you do for retirees could be helping them create an additional source of lifetime income paired with a strategy to combat inflation. Aside from pensions and Social Security retirement benefits, the only way you can help clients create predictable lifetime income is through an annuity. Predictable income from an annuity can boost clients’ confidence in having income for the rest of their lives, and they may feel more empowered to take greater investment risk with other assets.2 Annuities can provide steady “paychecks” in the form of annuity income payments once the contract is annuitized and potential “pay raises” with, for example, an optional cost-of-living adjustment feature, available with certain deferred annuities. With these features, retirees can be prepared for a potentially extended retirement period.
Athletes have coaches with the expertise to keep them on track and ensure they don’t overlook the basics. Coaches also identify and address minor issues before they become major problems. Like advice from a coach, holistic guidance from a knowledgeable financial professional might keep clients on track to pursue their goals—for instance, helping them financially prepare to live where they want to live in retirement and do what they plan to do with their time. Consider introducing them to other professionals in your network when needed, such as accountants and lawyers. A more holistic approach may even deepen relationships with clients—and their children—increasing the likelihood of continuing your relationships with the families down the line.
The holidays are a great time to reach out and remind clients how much you value helping them plan for their financial futures. With your guidance, they can take steps toward making their retirement dreams into reality.
ACTIONS YOU CAN TAKE RIGHT NOW
For more information about retirement-planning, please contact our Retirement Strategies Group at RSG@PacificLife.com or (800) 722-2333, ext. 3939. PacificLife.com
¹Dougan, Scott. “How to Plan for Retirement’s Go-Go, Slow-Go, and No-Go Years.” Kiplinger. March 29, 2024.
²Caminiti, Philip. “Understanding the behavioral benefits of annuities.” InvestmentNews. January 9, 2024.
This material is provided for informational purposes only and should not be construed as investment, tax, or legal advice. Information is based on current laws, which are subject to change at any time. Clients should consult with their accounting or tax professionals for guidance regarding their specific financial situations.
Pacific Life is a product provider. It is not a fiduciary and therefore does not give advice or make recommendations regarding insurance or investment products.
Annuity withdrawals and other distributions of taxable amounts, including death benefit payouts, will be subject to ordinary income tax. For nonqualified contracts, an additional 3.8% federal tax may apply on net investment income. If withdrawals and other distributions are taken prior to age 59½, an additional 10% federal income tax may apply. A withdrawal charge and a market value adjustment (MVA) also may apply. Withdrawals will reduce the contract value and the value of the death benefit.
This material is educational and intended for an audience with financial services knowledge.
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Pacific Life, its distributors, and respective representatives do not provide tax, accounting, or legal advice. Any taxpayer should seek advice based on the taxpayer's particular circumstances from an independent tax advisor or attorney.
Pacific Life is a product provider. It is not a fiduciary and therefore does not give advice or make recommendations regarding insurance or investment products.
Unless otherwise noted, all aforementioned money managers, their distributors, and affiliates are unaffiliated with Pacific Life and Pacific Select Distributors, LLC.
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Variable insurance products are distributed by Pacific Select Distributors, LLC (member FINRA & SIPC), a subsidiary of Pacific Life Insurance Company and an affiliate of Pacific Life & Annuity Company.
The home office for Pacific Life & Annuity Company is located in Phoenix, Arizona. The home office for Pacific Life Insurance Company is located in Omaha, Nebraska.
No bank guarantee • Not a deposit • Not FDIC/NCUA insured • May lose value • Not insured by any federal government agency
For financial professional use only. Not for use with the public.
