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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.

What is reliance rate?

A reliance rate shows how much a client plans to rely on their investment portfolio for retirement income, as opposed to guaranteed sources like Social Security or a pension. Those with a higher reliance on their portfolio have a greater chance that market declines could derail their plans.
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 a client’s current retirement income strategy by checking:
  1. “Heart rate” – the withdrawal rate
  2. “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 solutions can help you deliver a solution that best fits their retirement goals. Explore our options below.
Income with growth potential
Protective® Dimensions V Variable Annuity

Variable annuity

Growth potential, flexible income solutions and enhanced legacy protection
Income soon
Protective® Income Creator Fixed Annuity

Fixed annuity

Protected lifetime income with access to money

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We’re here for you

We’re ready to help you deliver the protection and security your clients deserve. Reach out to us anytime for questions and support, and we’ll get in touch with you as soon as possible.
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Welcome to Protective

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Protective Income Creator fixed annuity is a fixed, single premium, deferred annuity contract with a limited market value adjustment issued by PLICO in all states except New York under policy form LDA-P-2013. Policy form numbers, product availability, and product features may vary by state.

Protective Dimensions V variable annuity is a flexible premium deferred variable and fixed annuity contract issued by PLICO in all states except New York under policy form series VDA-P-2006. SecurePay Income benefits issued under rider form number VDA‐P‐ 6068 Policy form numbers, product availability and product features may vary by state.

Investors should carefully consider the investment objectives, risks, charges, and expenses of a variable annuity, any optional protected lifetime income benefit, and the underlying investment options before investing. This and other information is contained in the prospectus for a variable annuity and its underlying investment options. Investors should read the prospectus carefully before investing. Prospectuses may be obtained by contacting Protective at 800‐456‐6330.

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