There are just a couple of things almost all Genesco retirees need when they hit retirement: predictable income and protection against a cluster of risks, which include longevity risk, performance risk and sequence-of-returns risk.
In the past we have seen retiring Genesco employees utilize the “4% rule,” where retirees take annual withdrawals start at 4% of the entire portfolio and increase with inflation. They then keep the remainder of the portfolio with at least 50% invested in equities. Based on historical data, this would give a Genesco retiree about 30 years of retirement income.
As the economy constantly changes, a number of factors may force prospective Genesco retirees to revisit the 4% rule. It may be worth considering annuities as an alternative.
As life expectancies increase, Genesco retirees need to prepare for expenses over a longer time frame. In the past we would plan for a 15 to 20 year retirement, but now we need to prepare for a 30 to 35 year retirement. What is available to assist meeting the 35-year time frame?
The annuity strategy can assist with a few of the pitfalls we see in the 4% rule. For example:
If you need $50,000 per year in retirement and need that for 30 years, you may need $1.2 million in fixed income at a 3% interest rate. BUT if you look to fund $50,000 for 30 years, you can cover that expense with $800,000 by choosing the annuity option.
The other pitfall with the 4% rule is that it may not reflect a client’s risk tolerance. When you are accumulating assets, you can afford more volatility and can take on more risk than when in the retirement and withdrawal phase after leaving Genesco.
Also, should we see a drop in the market, you would be able to reduce your income using the 4% rule, which you cannot do if you choose an annuity option.
Articles you may find interesting:
- Corporate Employees: 8 Factors When Choosing a Mutual Fund
- Use of Escrow Accounts: Divorce
- Medicare Open Enrollment for Corporate Employees: Cost Changes in 2024!
- Stages of Retirement for Corporate Employees
- 7 Things to Consider Before Leaving Your Company
- How Are Workers Impacted by Inflation & Rising Interest Rates?
- Lump-Sum vs Annuity and Rising Interest Rates
- Internal Revenue Code Section 409A (Governing Nonqualified Deferred Compensation Plans)
- Corporate Employees: Do NOT Believe These 6 Retirement Myths!
- 401K, Social Security, Pension – How to Maximize Your Options
- Have You Looked at Your 401(k) Plan Recently?
- 11 Questions You Should Ask Yourself When Planning for Retirement
- Worst Month of Layoffs In Over a Year!
- Corporate Employees: 8 Factors When Choosing a Mutual Fund
- Use of Escrow Accounts: Divorce
- Medicare Open Enrollment for Corporate Employees: Cost Changes in 2024!
- Stages of Retirement for Corporate Employees
- 7 Things to Consider Before Leaving Your Company
- How Are Workers Impacted by Inflation & Rising Interest Rates?
- Lump-Sum vs Annuity and Rising Interest Rates
- Internal Revenue Code Section 409A (Governing Nonqualified Deferred Compensation Plans)
- Corporate Employees: Do NOT Believe These 6 Retirement Myths!
- 401K, Social Security, Pension – How to Maximize Your Options
- Have You Looked at Your 401(k) Plan Recently?
- 11 Questions You Should Ask Yourself When Planning for Retirement
- Worst Month of Layoffs In Over a Year!
What is the primary purpose of Genesco's 401(k) Savings Plan?
The primary purpose of Genesco's 401(k) Savings Plan is to help employees save for retirement by providing a tax-advantaged way to set aside money.
How can Genesco employees enroll in the 401(k) Savings Plan?
Genesco employees can enroll in the 401(k) Savings Plan by completing the enrollment process through the company's designated benefits portal.
Does Genesco offer a company match for contributions made to the 401(k) Savings Plan?
Yes, Genesco offers a company match for employee contributions to the 401(k) Savings Plan, which helps enhance retirement savings.
What types of investment options are available in Genesco's 401(k) Savings Plan?
Genesco's 401(k) Savings Plan typically includes a variety of investment options, such as mutual funds, target-date funds, and other investment vehicles.
Can Genesco employees change their contribution percentage to the 401(k) Savings Plan?
Yes, Genesco employees can change their contribution percentage to the 401(k) Savings Plan at any time, subject to certain guidelines.
What is the minimum age requirement for Genesco employees to participate in the 401(k) Savings Plan?
Genesco employees must be at least 21 years old to participate in the 401(k) Savings Plan.
Are there any fees associated with Genesco's 401(k) Savings Plan?
Yes, there may be administrative fees and investment fees associated with Genesco's 401(k) Savings Plan, which are disclosed in the plan documents.
How often can Genesco employees access their 401(k) account statements?
Genesco employees can access their 401(k) account statements quarterly through the benefits portal.
What happens to Genesco employees' 401(k) savings if they leave the company?
If Genesco employees leave the company, they can roll over their 401(k) savings into another qualified retirement account or withdraw the funds, subject to tax implications.
Does Genesco allow for loans against the 401(k) Savings Plan?
Yes, Genesco allows employees to take loans against their 401(k) Savings Plan balance, subject to specific terms and conditions.
-2.png)
.webp)