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Jack Dugan, Senior Financial Planner at Pure Financial Advisors joins Joe Anderson to discuss saving tips for pre-retirees. The two discuss different stages of saving and important considerations to make depending on whether you’re behind or just looking to enhance your saving potential. Find out how to maximize Social Security benefits and whether you should be taking advantage of the 4% rule.

Important Points:

0:29 “One of the first things people need to figure out is where they are in the savings program. I categorize people into two different categories: early Earl or catch-up Carl. Early Earl means you have plenty of time on your hands; you’re able to use compound interest to your advantage… Catch-up Carl on the other hand is behind; they really need to accelerate their savings programs.”

1:42 “Generally speaking, whatever I’m making today is probably what I’m going to need in retirement.”

2:01 “If I have all of my savings in my 401(k) or IRA, I’m going to end up with a huge tax problem. So I want to start spreading that out so I can control my income once I’m in retirement. I want to have money hopefully in a Roth and also have some non-qualified money so I can control my income when I’m pulling money out of those pools.”

2:22 “You want to have a good idea of where your assets are held.”

3:07 “The increase that you can get by delaying Social Security from 66 to 70 is 8% a year or a compound of 32% total. That’s a huge difference as far as income.”

4:03 “The 4% rule is the draw down percentage that is supposedly considered a safe draw down withdrawal. In other words, if I can take 4% of my total assets and draw them down, there’s a good chance I won’t run out of money in my lifetime.”

4:30 “There is one caveat there that we need to consider. It’s the fact that interest rates are so low right now that the fixed income part of our portfolios are generally not returning what they did 30 or 40 years ago. So you really want to stay on the safe side of that 4% rule.”

5:18 “One of your biggest expenses might be taxes in retirement.”

About the Hosts

Joe Anderson

President

CFP®, AIF®

As President of Pure Financial Advisors, Joe Anderson has led the company to achieve over $2 billion in assets under management and has grown their client base to over 2,160 in just ten years of the...

Alan Clopine

CEO & CFO

CPA, AIF®

Alan Clopine is the CEO & CFO of Pure Financial Advisors. He currently shares the CEO role with Michael Fenison, the original founder of the company. Alan is primarily responsible for the day-to-day activities of...