How to Build a “Personal Pension” for Your Retirement

Have you ever wondered why retirement planning feels so much harder for us than it did for previous generations?

It’s not just in your head! The landscape of retirement has fundamentally shifted over the last few decades. In 1970, nearly 50% of the workforce had private pension plans funded and managed by employers. Those plans guaranteed income for life. Today, that number has plummeted to just 11%.

When Congress created the 401(k) in 1978, it was never originally intended to be the primary retirement vehicle for the average worker. But as the various forms of 401(k)/403(b)/IRA accounts have replaced pensions in company benefits, the responsibility for funding, investing, and managing retirement has shifted almost entirely onto you.

Jump to…

• The Problem: What is an income gap?
• The Solution: Holistic Planning and a "Personal Pension"
• Take Action: How to Get Your Free Mini Plan
• Citations and Disclosures

The Problem: The "Beefless" 401(k) and the Retirement Income Gap

Remember the iconic 1984 Wendy’s commercial where Clara Peller poked at a giant, fluffy hamburger bun and demanded, "Where's the beef?" In his new book, “The Wells of Wealth System,” CEO Don Chamberlin, argues that many Americans are facing a similar, "beefless" reality with their retirement.

Most 401(k)s focus on accumulation (the "bun") rather than reliable income (the "beef"). If you have a million-dollar "pot" but no plan to convert it into a paycheck, you’re just holding a very large bun.

The "accumulation" strategies used during your working years — simply buying and holding — are the exact opposite of what you need during the "decumulation" phase (spending your money). Without a plan to protect your assets from market volatility, you risk compounding your losses just when you need the money most.

The Solution: Using Holistic Planning to Build a Personal Pension

The goal is to bridge the gap between growing wealth and creating the income you need to enjoy it. Chamberlin uses a "holistic" approach built on Seven Pillars.

The Wells of Wealth System is a proprietary retirement income strategy that organizes assets into Liquid, Conservative, and Growth “wells” to protect against market volatility. By organizing your wealth into these three essential "Wells,” you can create a "pension" for yourself that allows you to spend with confidence, regardless of what the stock market does next Monday.

How does it work? In the big picture:

• Your Liquid Well has enough money to cover your expected expenses for the next 6-12 months (and a little extra in case of an emergency),
• Your Conservative Well has enough money to cover your expected income needs for the next 10 years or so, and
• Your Growth Well with the money you’ll need in 10+ years.

The wells work together as a system because of how the money flows between them. Your primary “flow” is from your liquid well into your day-to-day life. As you go through those assets, you replenish them from your conservative well, leaving your long-term assets in the growth well to keep developing. When there’s a downturn in the market or in the economy broadly, those assets have time to recover before you need to start moving them into the conservative well to keep the income flow moving. The types of assets and investments in each “well” are chosen through the lens of these time horizons, based on diversification potential and their market exposure and volatility.

Take Action: Get Your Free Book and Chamberlin Mini-Plan

You’ve worked a lifetime to earn your money; you deserve a system to help you stay organized while you spend it. Don’t wait for the next down market to stress-test your retirement.

To start your planning journey and get your free copy of 'The Wells of Wealth System' book, schedule a 20-minute strategy session with a certified Retirement Educator. Your Retirement Educator will talk through the complimentary mini-plan you’ll receive if you qualify to work with one of our holistic planners.

This mini-plan includes three customized reports specifically tailored to you and your needs:

1. Your Social Security Maximization Report,
2. Your Tax & Portfolio Audit,
3. And based on those first two reports, your custom, tailored Wealth of Wells Plan.

We used to charge our clients $2,500 for this comprehensive analysis, but we’ve made it free as our way of helping Americans create more predictable retirements.

When you schedule your 20-minute, no-pressure strategy call with one of our experienced retirement educators at Chamberlin, they’ll walk you through the Holistic Planning process, talk through your current financial situation, and, if we seem like a good fit for each other, they’ll pair you with a certified financial planner who will guide you through the rest of the journey toward a comprehensive plan. These are folks trained to answer questions, not certified to sell products, so don’t worry about pressure to sign on that day.

(And don’t forget to ask your Retirement Educator about your free copy of, “The Wells of Wealth System.” We’ll mail it out within a couple days of your call at no cost to you!)

Even if you’re not quite ready to take that step, we still want you to feel knowledgeable and empowered as you move that direction. Check out the Learning Center on our website for videos and blog posts that will help you understand the different factors at play in a holistic retirement plan and how you can start making small changes today that will have a big impact tomorrow.

Citations and Disclosures

Notes

● Bureau of Labor Statistics. (2023). Employee benefits in the United States – March 2023 (USDL-23-2022). U.S. Department of Labor. https://www.bls.gov/news.release/pdf/ebs2.pdf

● Wiatrowski, W. J. (2011). The last private industry pension plans: A visual essay. Monthly Labor Review, U.S. Bureau of Labor Statistics. https://www.bls.gov/opub/mlr/2011/12/art1full.pdf

● Internal Revenue Service. (n.d.). History of 401(k) plans. https://www.irs.gov/retirement-plans/401k-plan-overview

● Young, A. S. (2016). The birth of the 401(k). Employee Benefit Research Institute (EBRI).

● Pfau, W. D. (2017). Retirement income guidebook: Understanding the role of elective investments, annuities, and social security in a retirement income plan. Retirement Researcher Media.

● Milevsky, M. A. (2006). The calculus of retirement income: Financial models for pension annuities and life insurance. Cambridge University Press.

● Social Security Administration. (2024). The 2024 annual report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Federal Disability Insurance Trust Funds. https://www.ssa.gov/OACT/TR/2024/

● Vanguard. (2024). How America saves 2024. Vanguard Institutional Investor Group. https://institutional.vanguard.com/content/dam/inst/iig-transformation/has/2024/pdf/has-report/how-america-saves-report-2024.pdf

Disclosures

As of the writing of this book and blog post, the author is an investment adviser representative and supervised person of Foundations Investment Advisors, LLC (“Foundations”), an SEC registered investment adviser. The opinions and assertions expressed in this book are solely those of the author and do not necessarily reflect the views of Foundations. Foundations’ involvement with this book has been limited to performing a high-level compliance review.

Any statistical data or information included herein has been obtained from third-party sources believed to be reliable; however, neither Foundations nor any third-party has independently verified such data and information. Foundations does not guarantee its accuracy or completeness, and neither Foundations nor the author has any obligation to, nor will they, update information that is later determined to be inaccurate for any reason (including becoming stale or outdated).