Weekend Reading: What's Your Retirement Income Style?

This article appears as part of Casey Weade's Weekend Reading for Retirees series. Every Friday, Casey highlights four hand-picked articles on trending retirement topics and delivers them straight to your email inbox. Get on the list here.
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Weekend Reading

You have a unique personality and preferences. Shouldn’t these elements be integrated into your retirement income strategy?


Enter the RISA: Past podcast guests Dr. Wade Pfau and Alex Murguia developed a revolutionary assessment called the Retirement Income Style Awareness (RISA) profile. Taking the RISA questionnaire helps you identify retirement income solutions that can suit your unique needs and desires, and it’s a program we’re eagerly incorporating into our own planning process. Upon completion of the assessment, you fall into one of four possible quadrants:

📌 Safety-First Outlook, Commitment Orientation: You prioritize guaranteed income for life and may opt for annuities or other sources of fixed, non-discretionary income, while maintaining an investment portfolio for discretionary spending.

📌 Safety-First Outlook, Optionality Orientation: You seek stable cash flow and safety, but don't require contractual guarantees. You may use a bucketing strategy, where your portfolio is organized to meet different time horizons for spending.

📌 Probability-Based Outlook, Optionality Orientation: This strategy is based on the concept of a total return portfolio with periodic withdrawals. You typically invest in a diversified portfolio, including higher-risk assets, and adjust your spending based on portfolio performance.

📌 Probability-Based Outlook, Commitment Orientation: You desire exposure to risk assets, but also seek downside protection and a structured income stream. Variable and indexed annuities are common with this "risk wrap" strategy.

Ask yourself: Which quadrant fits you? This may be more important than finding the mathematically most efficient strategy.