California Retirement Income: Why Guarantees Beat Market Risk

California Retirement Income: Why Guarantees Beat Market Risk

Retiring in California can be both exciting and challenging. While the Golden State offers incredible weather, access to world-class healthcare, and a vibrant lifestyle, it also comes with **high living costs and market volatility** that can quickly derail your retirement income plan.

That’s why it’s time to rethink the traditional approach to retirement—and instead focus on **guaranteed income strategies** that are more stable and secure.

A **McKinsey report** recommends that only **30% of retirement income should come from the stock market**, while **70% should be generated from annuities and life insurance**. This is especially important for Californians who want to **preserve their nest egg** while still enjoying a high quality of life.

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## California’s Cost of Living and Retirement Risk

With soaring housing, healthcare, and daily living expenses, California retirees face one of the **highest cost burdens in the country**. Combine that with stock market uncertainty, and it’s clear: **depending entirely on the market is risky**.

Even though long-term market returns average about **7.2%**, actual compounded growth is closer to **5.77%** when accounting for volatility. That’s before considering taxes, investment fees, and inflation—factors that hit retirees especially hard in California.

If you’re relying on the old **4% rule**, you may be withdrawing too much or risking running out of money too soon.

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## Why Annuities Work Well for California Retirees

With current interest rates at multi-decade highs, **annuities** are offering guaranteed income options that **rival or even exceed long-term stock returns**, without the downside.

### Benefits of annuities in California:

* **Guaranteed lifetime income**
* **No market risk**
* **Custom options based on lifestyle and goals**

Whether you’re retiring in Los Angeles, San Diego, Sacramento, or the Bay Area, annuities can provide **predictable cash flow** that helps you meet monthly expenses confidently.

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## Life Insurance as a Retirement Tool in California

Permanent **life insurance** is more than just a safety net—it can be a **strategic retirement income tool** when structured properly.

### Key benefits for California retirees:

* **Tax-deferred growth**
* **Tax-free income via policy loans**
* **Estate planning benefits**
* **Protection from California probate**

If you’re aiming for a steady 5% return, life insurance can potentially **match those results with less risk** and **more tax advantages**—something every Californian should consider.

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## Building a Balanced Retirement Income Plan in California

Following McKinsey’s recommended structure:

* **30% of your income** can still come from the market for growth
* But **70% should be secured through annuities and life insurance**

This blend offers **protection against California’s high cost of living**, while giving you **peace of mind and consistent income**—regardless of market swings or economic uncertainty.

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## Why Choose Mintco Financial in California?

At **Mintco Financial**, we specialize in helping California retirees create **tailored income plans** that work. We are fiduciaries—so our only goal is to provide you with the **best strategies to protect and grow your retirement income**, without unnecessary risk.

📍 Whether you’re in Orange County, San Francisco, or Palm Springs, we offer **personalized, virtual planning sessions** to meet your needs wherever you are.

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