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Blogging WealthTrack: Christine Benz (Retire Early? Or not?)

 This morning I've watched an interesting video on Consuelo Mack: WealthTrack. Here, Consuelo's guest, a longtime contributor, Christine Benz, a personal finance expert from Morningstar joined Consuelo for a discussion on issues related to retirement, in particular in the current market environments. This conversation is even more interesting against the backdrop of The Great Resignation.

I found Christine's advice to be particularly interesting on a couple of fronts. Her advice in dealing with talking about retirement in general, in particular for people who are in the process of thinking about retiring early gave me pause. She is considering the traditional advice of a 4 percent withdrawal rate to be dangerous and indeed, actually concerning. According to the recent research she cites, a 3% withdrawal rate is a better option.

Even more than the four percent rule, I think that her comments on annuities are particularly interesting. While annuities have been given a bad name, she has certainly brought some interesting considerations around them in the current environment. In particular, Christine indicates that Annuities provide an excellent opportunity to benefit from the pooled longevity risk to achieve a higher than average return relative to fixed assets, but that inflation is a real risk, especially in the current environment. 

She does an excellent job to discuss some of the options for handling a portfolio through the current macroeconomic storm we're facing. I'd encourage you to watch to get some ideas you might apply to your own situation.

Consuelo indicates that early retirement might be something that the viewer might want to reconsider. Given the lack of a steady paycheck, increasing uncertainty around inflation numbers and the loss of a large amount of capital at the beginning of a longer-than-usual retirement, this doesn't seem like a bad idea at all in terms of personal finance advice.

As usual, I am a fan of WealthTrack and I recommend you check out the episode from this week here: Christine Benz - Consuelo Mack: WealthTrack 






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