Foolproof Plan for Retirement Income Protection; the cashflow ladder
Vložit
- čas přidán 26. 06. 2024
- Leaving your money invested during your retirement can be daunting to say the least It’s all very well riding market volatility when you’re still earning, but what about when you are taking an income from your hard earned ISAs and pension pots?
In this video, I am going to take you through how to build a cash flow ladder to ensure that you strike a balance between investing to make your money work as hard as possible while at the same time ensuring that you don’t run out too soon.
Book your free call with me here
diannesullivan.co/
timestamps
0:00 intro
0:47 what is a cash flow ladder
2:05 how to build a cash flow ladder
4:49 regularly reassess
Thank you Dianne. Another great video! I have half my pension in rental income so this mitigates the risk somewhat. Worse case, I probably could live off my rental income while waiting for the recovery but having something setup like you suggest sounds very wise.
Glad to hear this was helpful. Thanks!
Nice video Dianne. I like your ladder model for de-risking capital held in retirement.
I’m sure this reply was meant for Mike. 😃
@@davidplanet3919 Yes you're right - oops. Don't know how that happened. I'm pleased to hear that you enjoyed this video. Thanks for your comment - I really appreciate it
Love this, Dianne! Sound advice. I'm spreading word about your channel.
Hello Nicola! Thank you for spreading the word ;-)
Great advice Dianne! Very relevant for the time, probably in our forties or so, when we realise we had better do something more proactive about pensions!
Thank you Dianne,. I haven't seen many videos on this topic.
I am part way through constructing my version of the cash flow ladder based on the book "It's all about the income" by Mike Lynch (a US financial Adviser).
I want to have enough cash for all my income needs for current year and the next year (so years 1 and 2).
I also want enough for my year 3 expenditure in a single gilt that will expire in year 3 (so I have a known lump sum coming to me during year 3 when the gilt matures).
I also want enough for my year 4 expenditure in a single gilt that will expire in year 4 (so I have a known lump sum coming to me during year 4 when the gilt matures).
The rest I am happy to have in 90% to 100% in equities. If my shares increased in value I will draw my income from the shares. If my shares have fallen in value I will take my income from the appropriate year - and then rebuild the ladder after the shares have recovered.
Thanks for the book tip - I'll check it out. Sounds like you're on top of building solid strategy that will work for you. Well done!
I love this strategy and plan to implement it for my retirement (although I'm still in my forties). However, one aspect I struggle to understand is 'bonds.' They seem to underperform compared to money market funds or high-yield cash accounts. Consequently, my retirement plan shows a longer period of cash investments, followed by regular funds like a World Index, and something a bit riskier at the top. Maybe as I get older, I'll understand bonds better. Thank you for the content!
And thank you for watching and commenting! Think it's about time I made a video on bonds...what do you think?
@@DianneSullivan Can't wait! :)
Hi Dianne, great video. I have recently built a cash ladder, using money market fund / premium bonds and high interest savings account for rung 1. I have more than 2 years worth, but that’s because I like to err on the side of caution, although I should probably be more adventurous!
Only be as adventurous as you feel comfortable with! Actually that should be a motto for life not just for investing :-)
@@DianneSullivan 😉👍 Yes!
I have a DB pension that covers our basic needs. I run the ladder alongside this, but don't use bonds as hope the DB does the downmarket protection instead
Sounds sensible to me...good that you have a DB pension to cover the basics
That's an interesting video and idea but listening to other channels in this space seem to imply that bonds are not the right vehicle these days, as they perhaps were in the past?
Based on yours and other comments, I've added a video on bonds to my list. Thank you!
Bonds... I dont really understand them.Stocks and shares ISAs and unit trusts , I do get..To me, bonds are just lke unit trusts except that the individuals who administer them arent under so much end user pressure to perform and are therefore inclined to take the easy life route. Are you able to shed any light on the bond market?
Bonds are easy.
Company's issue bonds to raise money and in turn, pay you a set rate for the duration of the loan.
While the face value of the bond can and does fluctuate, if held to maturity, you will receive your investment back in full.
That's it in a nutshell.
There are also Bond Funds, which spread out the risk
My retirement plan is to make a CZcams channel about retirement - btw how approx much income does CZcams make you?
Only about £20-£59 per month and that's after the 2 years it took before my channel was monetised. Ad sense revenue alone is pretty low unless your videos get 500k + views consistently. I choose not to be sponsored by anyone, despite many offers. So you should go for it, particularly if you have qualifications in financial advice or retirement planning. Having a YT channel as an income stream could definitely work for you if you get sponsors as that’s how most CZcamsrs make a living from it, rather than from in-video ad revenue. My income is from coaching.
@DianneSullivan
Thank you for your candor!
I will be getting £13.200 pounds after tax one off pension Jan 2025 when I reach 66 pension age, I am on Full PIP and DWP benefits, I have called Age and Face 2 Face, Money Helper 3x even tho I found out they are a part of the government but no one could tell me anything total blank, Please Help Me ?
Will my benefits stop? How Much will I get to keep? I was told the tax will be paid before hand, I have read I can save £10.000 come pension time, that £4000 more than now at £6000 will this help me on the day ? Thank you ..