Retire Sooner, Retire Richer : How to Build and Manage Wealth to Last a Lifetime

by Netti, Frank

• ISBN13: 9780071396998
• ISBN10: 0071396993
• Edition: 1st
• Format: Paperback
• Copyright: 2003-02-27
• Publisher: McGraw-Hill

Summary

Hands-on investment strategies for facing the new financial realities of retirement ". . . every conceivable facet of retirement planning and the adviser-client relationship is dealt with in a manner that is methodical yet entertaining."--William J. Bernstein, M.D., Ph.D., principal, Efficient Frontier Advisors, and author of The Intelligent Asset Allocator Today's burgeoning class of retirees is discovering that financial needs--not to mention investment guidelines--change significantly after retirement. Retire Sooner, Retire Richer addresses the very real concerns of not only planning for retirement but also where to invest assets both prior to and during retirement. Frank L. Netti helps to answer important concerns on these matters, including: Is a financial planner necessary? How can I design an effective, personal pension plan? How can I be certain that my savings will last my lifetime? What kinds of insurance options do I have? Using the four keys to financial preparedness, Retire Sooner, Retire Richer shows readers how to make the most of their investments for the long term.

Author Biography

Frank L. Netti, C.I.M.C., is an associate vice president with a major Wall Street investment firm. A contributing columnist to the Syracuse Herald Journal and a regular radio guest, he has provided clients with financial and retirement advice for more than two decades.

Table of Contents

Acknowledgments	ix
Introduction	1	(4)
Do You Have a Strategy?	5	(1)
Don't Be Fooled by Past Performance	6	(1)
Avoiding Big Errors	7	(1)
The Why and How of Investing	8	(2)
Everyone Retires	10	(5)
Part One Understanding Your Retirement Investments
The Numbers Game and Retirement Timing	15	(10)
The Big Difference: Accumulating Versus Spending	17	(1)
Uncertainty and Risk Within Our System	18	(2)
Understanding Averages	20	(2)
Market Returns Are Variable	22	(3)
Factors to Consider When Transitioning to Retirement	25	(18)
Insurance Needs	28	(4)
Cobra	32	(3)
Life Insurance and Income Protection	35	(1)
How Much Insurance Will You Need?	36	(2)
To Cover Long-Term Care, Spend Down	38	(5)
Why Some Retirement Plans Fail and Others Succeed	43	(20)
Will Your Portfolio Survive?	44	(2)
It Is Better to Know the Truth	46	(1)
The 1968 Retiree	47	(1)
To Make Things Worse: The Average Return Blunder	48	(1)
What's Wrong with Being Right?	48	(1)
So Easy to Be Fooled	49	(2)
The Great Proposal Failure	51	(1)
Just the Facts, Please	52	(5)
Comparing Performance	57	(2)
You Can Bet on Yourself	59	(4)
How to Improve Your Money-Management Decisions	63	(22)
What Is the Process That Endowments Use?	64	(2)
Owning More than One Fund Reduces Risk	66	(2)
Setting Return Expectations and Standard Deviations	68	(2)
Only Time Will Tell	70	(1)
Do You Have Investment Experience?	71	(1)
Why Asset Allocation Works So Well	72	(3)
What Can Be Learned from Fiduciaries?	75	(2)
How Do Endowments Allocate?	77	(2)
Stop Trying to Predict the Market	79	(6)
Part Two Building the Wealth You Need
Portfolio Lessons for a Lifetime	85	(12)
Some Assumptions Can Be Off	87	(1)
At What Risk?	88	(1)
Success: It's All in the Discipline	89	(4)
It Takes Discipline to Remain Diversified	93	(4)
Why You Need to Act Now to Live Happily in Retirement	97	(12)
Why Do Retirement Assets Need Protection?	100	(1)
Don't Wait to Learn the Terms	101	(3)
Look for the Appropriate Investments	104	(5)
How to Make the Best Use of Your Retirement Distribution Options	109	(20)
Some of the Rules to Know	110	(1)
Substantially Equal Periodic Payment (SEPP)	111	(2)
Let's Get Creative!	113	(2)
Your Life Expectancy Is Not Your Own	115	(2)
The Social Security Gap	117	(5)
The SEPP Spigot	122	(1)
Another Use for the SEPP	122	(2)
Working Part-Time and Taking SEPP	124	(2)
Personally Tailored Advice	126	(1)
Lack of Advice Can Cost Plenty	126	(3)
How You Can Provide Added Income for You and Your Heirs	129	(16)
Choosing an Employee Retirement Pension Option	130	(1)
The Cash Balance Election	131	(2)
A Simple Case Study	133	(2)
Using Life Insurance to Create Income	135	(1)
Life Settlement Transactions	136	(1)
Purchasing a Viatical as an Investment	137	(2)
Company Stock in 401 (k) or Shares in Employee Stock Ownership Plans	139	(3)
What Is Income in Respect of a Decedent?	142	(1)
Who Are the Heirs to Your Retirement Money?	143	(2)
How to Use a Rollover IRA to Leave More to Your Heirs	145	(16)
Five-Year Rule and Postdeath Distributions of 401 (k)s	147	(1)
A Five-Year Rule for Rollovers with More Flexibility for Heirs	147	(1)
Advantage of the Rollover Stretch-Out (or Stretch IRA)	148	(2)
Using the Installment Over Life Expectancy Method	150	(1)
What Are Required Lifetime Distributions?	151	(5)
Summary of the New Required Minimum Distribution Rules	156	(5)
Part Three Managing Your Nest Egg
The Advisor Advantage	161	(18)
Types of Advisors	163	(2)
Investigating Designations	165	(2)
Locating Planning Help	167	(1)
With the Aid of an Advisor Your Behavior Improves	168	(2)
Experienced Professionals Have Dealt with Market Swings	170	(1)
How Will Your Portfolio Behave?	171	(2)
Beware of Other Biases	173	(1)
What We Learn from the Study of Behavioral Finance	174	(1)
Unforeseen Issues Can Surface	175	(4)
Creating a Financial Planning Review	179	(22)
What Type of Financial Advisors Offer Financial Planning Reviews?	181	(2)
Asking the Right Questions	183	(3)
Keeping You out of Trouble	186	(1)
How Can Investment Management Expertise Add Value?	187	(2)
The Process of Deciding	189	(1)
Seven Standards for Choosing Money Managers	190	(11)
The Importance of a Personal Investment Policy	201	(18)
Risk Tolerance and Time Horizon	202	(4)
The Importance of the Process	206	(1)
Investment Process Step 1	206	(2)
Investment Process Step 2	208	(2)
Investment Process Step 3	210	(6)
Concluding Remarks Regarding an IPS	216	(1)
Balancing Your Expectations	217	(2)
How to Pay for Financial Management Advice	219	(12)
Fees Associated with IRA, 403(b), 401(k), and Variable Annuities	222	(1)
Comparing Internal Expenses	223	(2)
Shop for Yourself	225	(1)
Conclusion	226	(1)
Evaluating Your Relationship with a Financial Advisor	227	(4)
Appendix: How Does the Tax Relief Act of 2001 Help Those Age Fifty and Over Create New Savings Opportunities?	231	(4)
Glossary	235	(14)
Resources	249	(6)
Index	255