There are just a couple of things almost all Guardian Life Ins. Co. of America 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 Guardian Life Ins. Co. of America 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 Guardian Life Ins. Co. of America retiree about 30 years of retirement income.
As the economy constantly changes, a number of factors may force prospective Guardian Life Ins. Co. of America retirees to revisit the 4% rule. It may be worth considering annuities as an alternative.
As life expectancies increase, Guardian Life Ins. Co. of America 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 Guardian Life Ins. Co. of America.
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.
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What types of retirement savings plans does Guardian Life Ins. Co. of America offer to its employees?
Guardian Life Ins. Co. of America offers a 401(k) plan as a primary retirement savings option for its employees.
How can employees of Guardian Life Ins. Co. of America enroll in the 401(k) plan?
Employees can enroll in the 401(k) plan by accessing the employee benefits portal or contacting the HR department for guidance on the enrollment process.
What is the employer match policy for the 401(k) plan at Guardian Life Ins. Co. of America?
Guardian Life Ins. Co. of America provides a competitive employer match for employee contributions to the 401(k) plan, which is detailed in the plan summary.
Can employees of Guardian Life Ins. Co. of America change their contribution percentage to the 401(k) plan?
Yes, employees can change their contribution percentage at any time by submitting a request through the employee benefits portal.
What investment options are available in the 401(k) plan at Guardian Life Ins. Co. of America?
Guardian Life Ins. Co. of America offers a range of investment options in its 401(k) plan, including mutual funds, target-date funds, and other investment vehicles.
Is there a vesting schedule for the employer contributions in Guardian Life Ins. Co. of America’s 401(k) plan?
Yes, Guardian Life Ins. Co. of America has a vesting schedule that determines when employees fully own the employer contributions made to their 401(k) accounts.
What is the minimum age requirement to participate in the 401(k) plan at Guardian Life Ins. Co. of America?
Employees must be at least 21 years old to participate in the 401(k) plan at Guardian Life Ins. Co. of America.
How often can employees of Guardian Life Ins. Co. of America make changes to their investment elections in the 401(k) plan?
Employees can make changes to their investment elections in the 401(k) plan at any time, subject to the terms outlined in the plan documents.
Does Guardian Life Ins. Co. of America provide financial education resources for employees regarding their 401(k) plan?
Yes, Guardian Life Ins. Co. of America offers financial education resources and workshops to help employees understand their 401(k) plan and make informed investment decisions.
What happens to an employee's 401(k) account if they leave Guardian Life Ins. Co. of America?
If an employee leaves Guardian Life Ins. Co. of America, they have several options for their 401(k) account, including rolling it over to another retirement account, cashing it out, or leaving it with Guardian.
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