What is a ‘Retirement Accumulator‘ compared to a ‘Retirement Distributor‘ — and why does it matter? Once you understand the difference, it will make sense. At Income For Life, our financial advisors can help you with any of your retirement income planning needs in Los Angeles, as well as other cities nationwide. Call us today for more information.
We explain the differences between a ‘Retirement Accumulator‘ and ‘Retirement Distributor‘ below:
When retirees or near-retirees come into my office to discuss their options for proper retirement income planning, the first thing I ask is “who is your Retirement Distributor?” Typically, the person across my table is uncertain what we mean, so we explain that the distributor is the person responsible for the distribution of your retirement assets to you so that your money lasts as long as you do.
The retiree across the table understands, nods and typically says, “We have a person at (fill in the blank) that we have worked with for some time now.” As we discuss further, we then come to the agreement that this person is typically NOT a retirement distributor and is normally the retirement accumulator, in which the two are apples & oranges when it comes to retirement income planning. Here are the differences between the two:
- The accumulator is typically the person responsible for accumulating assets for you – usually in the stock markets. This person’s sole responsibility is to accumulate as much money for you as possible so that when you retire, you have a strong nest egg to fall back on. This could come at the cost of both risk and fees but is necessary while at a younger age (typically up to age 50-55).
- The distributor is typically the person that you begin to utilize when you approach retirement age because the distributor uses those accumulated assets to build a retirement income plan for you that will last as long as you do. This person’s responsibility is the PRESERVATION and DISTRIBUTION of those assets, as opposed to the ACCUMULATION of those assets. This is the time when you want to risk and fees to be at the minimum (typically age 50-55 and older).
- Can the accumulator also be the distributor? Sometimes, yes.
- Is it rare that this person can wear both hats successfully? Unfortunately, Yes.
- Do most retirees understand the differences between the two? Typically, no.
When a retiree approaches retirement age, most need to look for a strong Retirement Distributor that understands that in retirement, the return OF your money is more important than the return ON your money.
You have worked hard for 40 years to accumulate your retirement accounts. Why leave it in a place where you could potentially lose it all inside 40 days – right at the time when you need it the most?
We agree. Call my team of distributors today to learn more about our retirement planning strategies and to find the best annuity rates in Los Angeles.
Matt Nelson, president
Income For Life LLC
877-284-8929 toll free
Retirement Income. Simplified.