Protect retirement income with a portfolio reliance rate review

Help strengthen your clients' retirement income plans with a portfolio reliance rate review. We're by your side with resources and solutions that can help you incorporate these reviews into your practice and better support clients' retirement goals.

Illustration of a chart with yellow and orange lines and arrows indicating an uncertain market.

The risks of relying on the markets

A poor sequence of returns early in retirement
Lower than expected dividends or bond yields

With a higher reliance rate, market declines could have a greater effect on a retirement strategy. Clients interested in lowering their reliance rate might find solutions like annuities appropriate.

Abstract illustration of a couple preparing for retirement with a graph symbol to indicate growth and dollar symbol to indicate income.

How can reliance rate support your clients' retirement goals?

Every client's goals and plans for retirement are unique. While there isn't one particular reliance rate that will work for everyone, in general, lowering a client's reliance rate on income vulnerable to the markets can help boost confidence in their overall plan.

Abstract illustration of a businessman walking on a tightrope between two locations marked reliance rate and withdrawal rate to show the importance of finding the right balance between the two.

Finding the right balance

Reliance rate: A higher reliance rate will make the portfolio more sensitive to market fluctuations. A lower reliance rate can tolerate more fluctuation with less need to cut spending.
Withdrawal rate: A more conservative withdrawal strategy can help offset a higher reliance rate. When markets decline, clients might need to consider lowering the withdrawal rate in the short term.

How to stress test a portfolio

Help your clients understand the concept of a reliance rate by using a health care analogy. Offer to measure the health of their current retirement income strategy by checking:

"Heart rate" – the withdrawal rate
"Blood pressure" – the reliance rate

Then, run the numbers using our reliance rate worksheet to set up your recommendations for better financial health.

Download the worksheet

Abstract illustration of a checklist, pen, and stethoscope to show how to stress test a portfolio using a medical analogy.

Video thumbnail for reliance rate video.

Help clients see the value in these reliance rate reviews

Play this video to show clients how a reliance rate works and how reviewing this rate can increase confidence in their retirement income strategy.

Solutions that can help lower portfolio reliance rates

When you've identified a need for guaranteed income in a client’s plan, our suite of annuity products can help you deliver a solution that best fits their retirement goals. Explore our options below.