Fundamentals of Retirement Income Planning

If you ask 50 different financial professionals how they handle income planning for their clients you are likely to find 50 different opinions on how to do it. But retirement has been studied for decades and there really is an optimal way to set up an income plan. It can be proven mathematically and scientifically.

In fact, this is a subject I studied while writing my second book “Retirement Income Masters – Secrets of the Pro’s.” I found 14 Retirement Income “Masters” from around the country. These were top financial professionals who focused almost solely on building solid and sustainable income programs for retirees.

What is so interesting is that the top financial professionals are all doing the same things! Why do you suppose that is? It’s because there is an OPTIMAL way to build a retirement income plan. See, these financial professionals, most of whom didn’t even know each other, all arrived at the same place. 

If you truly put your client’s needs and interests first, you too will come to the same conclusions. Now, these are not cookie-cutter financial professionals. They all use slightly different words and phrases to describe what they do for their clients. But the process is remarkably similar.

  1. They all talk about having a process. They are not product pushers. 
  2. They discuss helping the client define their vision and goals. They all calculate their client’s MUG—an acronym for Mortgage, Utilities and Groceries that represents any essential living expenses
  3. They help their clients separate their needs, wants and wishes. Needs should be covered with protected lifetime income from Social Security, Pensions and Annuities. Wants and wishes can be satisfied with other products invested for growth and legacy.


Briggs Matsko is a CFP, CRPC in the Sacramento, CA area. He has a simple four step process he calls “EASE.”

  • Step 1: Envision means find out the client’s hopes and dreams, what is important to them, and how much income will they need tocover their basic living expenses. What is important to them, how much income will they need to cover their basic living expenses. He divides expenses into Core, Joy and Legacy expenses. He covers the core expenses with Social Security, Pensions and Annuities. He uses a diversified portfolio to cover Joy expenses and uses insurance products to help maximize legacy to children, grandchildren and charity.
  • Step 2: Analyze the client’s information. Briggs and his team use technology to literally “see” a vision of their retirement lifestyle based on several market scenarios.
  • Step 3: Solutions is the part of the EASE method where he goes over all recommended strategies and makes sure all of their questions are answered.
  • Step 4: Evaluation means he meets with the clients on a regular basis to make any changes or updates based on life events or market turmoil.


John Curry, CLU, ChFC, AEP, CLTC is a financial professional in North Florida. He has developed the Secure Retirement Method. He uses words like “The Vision Session,” “the Discovery Session,” “the Strategy Session,” and “the Implementation Session.” I still remember the first time I met John. I was speaking about the importance of guaranteed lifetime income at an industry event. When I finished speaking, he rushed up to me like he had found a similar voice in the wilderness. He was one of the early adopters of guaranteed lifetime income, even before he learned about the math, science and hundreds of research papers that backed up his recommendations.


John P. Schwan is the CEO of the Schwan Financial Group in Aberdeen, SD. He developed the Ideal Plan ProcessTM to help his clients do the same things. He says, “No one’s ever come to me in the last 30 years and said ‘John¸ please make sure I’m destitute and broke for my last 15 years’ or ‘Please make sure that I pay as much income, gift and estate taxes as humanly possible.’ So, we focus on creating certainty of income as well as an overall approach that can help in minimizing taxes and enhancing wealth. In many cases, net worth actually has very little to do with the strategy. It’s all primarily about creating a steady and guaranteed cash flow.”

John also emphasizes that it is not just economics. It is psychology as well. Financial professionals who only look at investments may very well be ignoring the emotional or “Psychonomic” value that protected lifetime income provides.

Dr. Michael Finke recently wrote an article in Advisor Perspectives1 that showed why an investment only solution to retirement income has huge problems. “We went from a 94% probability of success to 63% in just 3 weeks,” he says about Coronavirus market meltdown. Not only does a 4% withdrawal rate have problems due to sequence of returns risk, think of the emotional toll on the retiree who is watching their retirement portfolio plunge before their very eyes.

Seeking Alpha2 recently summed it up very well in an article titled “Guaranteed Retirement Income Should be Considered for Part of Your Bond Allocation.” The loss of pensions has shifted three big risks to the new retiree – Longevity Risk, Withdrawal Rate Risk, and Sequence Risk. By moving a portion of the bond portfolio into a lifetime income annuity, you can aim to increase portfolio returns (due to the mortality credits), reduce portfolio risk and mitigate those three big risks. Additionally, the article mentions the emotional side. Retirees who have protected lifetime income can be happier. I want to be happy in retirement too. How about you?

Find out more about our broad suite of annuity solutions.



Annuities are long-term investments designed for retirement purposes. The value of variable annuities is subject to market risk and will fluctuate. Product guarantees are subject to the claims-paying ability of the issuing insurance company. Earnings, when withdrawn, are subject to federal and/or state income tax, including a 10% tax penalty for withdrawals before age 59½. Some income guarantees offered with annuities take the form of optional riders and carry charges in addition to the fees and charges associated with annuity products.

There is no guarantee that any investment will achieve its objectives, generate positive returns, or avoid losses. Investments in annuity contracts may not be suitable for all investors.

M-6108-F46 (10/2021)