Basic Philosophy Summary: Our basic philosophy is that it’s more valuable to avoid the losses than it is to pick the winners. Integrated Retirement PlanningThere are two very distinct schools of thought for managing the finances of retirement. First, probability-based advocates generally support using an aggressive investment portfolio with a large allocation to stocks to meet retirement goals. With these investment solutions, a higher lifestyle may be supported if one is willing to spend and invest aggressively in the hope of subsequently earning higher market returns. Should decent market returns materialize, investment solutions can be sustained indefinitely while also helping to support legacy and liquidity.Probability-based advocates are generally comfortable with the expectation that decent returns will materialize such that these approaches will probably work just fine. However, an investments-only mind-set is not the optimal way to build a retirement income plan. There are pitfalls in retirement that we are less familiar with during the accumulation years. Traditional wealth management is not equipped to handle longevity and sequence risk in a fulfilling way.Retirees must self-manage longevity and market risk, which means more assets are required to cover spending goals over an assumed long time horizon combined with the possibility that poor market returns chip away at the portfolio.Nonetheless, longevity protection is not guaranteed with investments and assets may not be available to support a long life or legacy. For retirees who are worried about outliving their assets and not successfully meeting their lifetime financial goals, probability-based strategies can become excessively conservative and stressful.Avoid the LossesWhile we utilize market-based strategies, we focus on the other school of thought: the safety-first approach to retirement income. Safety-first advocates support a more bifurcated approach to building retirement income plans that integrates investments with insurance, providing lifetime income protections.Probability-based advocates generally view annuities and life insurance as unnecessary in retirement. They see the stock market as a straightforward way to obtain superior retirement outcomes. Safety-first advocates disagree.Risk pooling with insurance provides an alternative means for potentially earmarking fewer assets to cover lifetime spending goals, effectively reducing the potential overall cost of retirement. With risk pooling, one does not need to plan for the very expensive case of an extremely long life combined with poor market returns. Instead, the retiree pays an insurance premium that will provide a benefit to support spending if those risks materialize and retirement becomes more expensive. An unprotected investment portfolio may otherwise deplete. Insurance companies can pool sequence and longevity risks across a large base of retirees, allowing for retirement spending that is greater than the sustainable withdrawal rate from investments for someone self-managing these risks.When bonds are replaced with insurance-based risk pooling assets, retirees improve the odds of meeting their spending goals while also supporting more legacy at the end of life, especially in the event of a longer-than-average retirement.Lifetime income through insurance, whether that be annuities or life insurance, can help to:manage market volatility and investment risksprotect from longevity riskmore efficiently earmark assets to cover retirement spendingreduce fear and worry about outliving their assets in retirementand to simplify the financial plan.