The Financial Water Wheel

Today’s Prep:

On this podcast, we love a good analogy. Join us as we discover what we can learn from retirement by observing a water wheel.

(Click the featured times below to jump forward in the episode)

Equipping Points:

1:10 –  What Is A Water Wheel?

  • A water wheel is a machine used for grinding grain. Water is diverted toward the wheel, and as the water turns the wheel’s paddles, the wheel manually powers the gristmill or sawmill. See the example of George Washington’s gristmill below.

1:48 – How Is Retirement Like A Water Wheel? 

  • A water wheel requires a consistent stream of water to turn and power the mill. Similarly, you need a consistent stream of income to power your retirement. If your proverbial stream starts flowing, your retirement could be in trouble. As you’re preparing for retirement, you need to develop a predictable income plan.

4:06 – What Income Streams Are Powering Your Water Wheel?

  • We take your pension, Social Security, qualified retirement accounts, and brokerage accounts all into account as we calculate the level of income you’ll be able to receive in retirement.

6:04 – What Could Stem Your Flow Of Income In Retirement?

  • Market withdrawals, healthcare costs, and rising rates of inflation could all reduce your income in retirement. Your plan needs to prepare you, so that even if there’s a drop in the market, your income will continue to consistently flow into your retirement.

9:53 – Diversify Your Income Streams.

  • If all of your income is coming from one place, you could be in trouble should your stream run dry. You need to develop multiple streams of income, and that’s where annuities come into play. Annuities essentially agree to either protect your principal or give you an income. They can be a useful tool for generating income in retirement. Remember, there’s no bad tool when it comes to your retirement. You simply have to determine what tools you’ll need to put your plan together and accomplish your goals.

Today’s Takeaway:

More From Eric:

The host: Eric Peterson - Contact - Call: (515) 226-1500

Subscribe To The Podcast:

Apple Podcasts  -  Google Podcasts  -  Spotify  -  Stitcher  -  iHeartRadio  -  TuneIn

Check out some other recent episodes

4 Things March Madness and Retirement Planning Have in Common

March 21, 2019

What does your March Madness bracket have to do with financial planning? More than you might think!

Read More

Why Retirement Planning Ain’t What It Used To Be

March 14, 2019

You’ve heard your parents discussing how difficult things used to be. We’ve all heard the adage about walking uphill both ways in the snow to get to school. However, reality suggests retirement planning actually used to be easier than it is today. Find out why.

Read More

3 Questions You Should Ask A Potential Advisor

March 7, 2019

When shopping for a potential advisor, you want to find the right fit for your needs. Ask each candidate these three important questions.

Read More

Episode #27: It’s Time To Talk About RMDs

February 21, 2019

Required minimum distributions can easily slip through the cracks of your retirement plan. As tax day 2019 is approaching, understand the impact RMDs will have on your finances.

Read More

Episode #26: Taking Care Of Family

February 14, 2019

Part of retirement planning includes taking care of family. After all, you’ll want to make sure your loved ones have what they need after you’re gone.

Read More

Episode #25: Retirement On The Golf Course

February 7, 2019

Learn how retirement planning is a bit like golf. Grab your sticks, and join us on the proverbial golf course.

Read More

Episode #24: Breaking Bad Financial Habits

January 31, 2019

While it’s easy to slip into a routine, some of the habits you’re developing might do more harm than good. Eric offers tips for breaking bad financial habits.

Read More

Episode#23: Prepping For Tax Season

January 24, 2019

It’s the time of year when people start thinking about taxes. We’ll ask a few questions and offer a few tips to prepare you for tax season.

Read More

Episode #22: Common Money Mistakes

January 17, 2019

There are many moving parts in a successful retirement plan. If you’re not careful, it’s easy to gloss over key details. Eric uncovers some of the common money mistakes he sees people making.

Read More

Episode #21: Retirement Income Planning

January 10, 2019

Income planning is an essential part of retirement planning. Learn to examine your income needs in retirement, and join us for a conversation on diversification. 

Read More

Leave a Comment