Covell Financial

Employers traditionally provided their workers a pension. A pension was a lifetime of guaranteed income that the employee received after retirement. The pension was actually an annuity handled and guaranteed by an insurance company.

In more recent years this has changed. Instead of a guaranteed retirement income, employers started providing 401(k) plans which cost them much less and shifted the liability solely to the employee. This introduced the element of risk. If the plan did well on a consistent basis, then there might be enough to finance a good retirement. On the other hand, if the 401(k) experienced any losses, that directly affected how well, or even IF, the employee could retire.

New studies by the accounting firm of Ernst & Young and the Center for Retirement Research at Boston College show that relying solely on savings together with Social Security income is resulting in 90% of Americans destined to die broke.

On the other hand, if people put some of their savings into lifetime income, their odds of living a full life without going broke are increased by a factor of 4. We at Covell Financial have put together a plan that we call a Private Pension. This plan takes a portion of savings and puts it into a lifetime guaranteed income stream --just like the traditional (and safe) employee pension. Ask us for more information.