Understanding Your Options in Retirement

June 10, 2024

Preparing for retirement can be both exciting and overwhelming. Your Fresno financial advisor understands that with so many options available, it’s important to understand what choices are best suited to your individual needs. Whether you’re looking to travel the world or simply enjoy a relaxing lifestyle, having a clear understanding of your options is key.

Traditional retirement plans

When it comes to retirement planning, traditional retirement plans are often the first option that comes to mind. These plans are typically offered by employers and provide a defined benefit based on your years of service and salary history.

One advantage of traditional retirement plans is the tax benefits they offer. Contributions are often made on a pre-tax basis, meaning that you can lower your taxable income and potentially reduce your tax liability.

Individual retirement accounts (IRAs)

Individual retirement accounts, or IRAs, are a popular retirement savings option for individuals who do not have access to employer-sponsored plans or want more control over their investments. There are two main types of IRAs: traditional IRAs and Roth IRAs.

Traditional IRAs allow you to make tax-deductible contributions, meaning that you can lower your taxable income for the year. The funds in the account grow tax-deferred, meaning that you won’t owe taxes on the earnings until you make withdrawals in retirement.

Roth IRAs and their benefits

Roth IRAs are a popular retirement savings option for individuals who want to enjoy tax-free income in retirement. Unlike traditional IRAs, contributions to Roth IRAs are made with after-tax dollars. While you won’t receive a tax deduction for your contributions, the funds in the account grow tax-free, and qualified withdrawals in retirement are also tax-free.

One of the key benefits of Roth IRAs is the flexibility they offer. Unlike traditional IRAs, Roth IRAs do not have required minimum distributions (RMDs) during the account owner’s lifetime. This means that you can leave the funds in your Roth IRA untouched for as long as you like, allowing them to continue growing tax-free.

Annuities as a retirement option

Annuities are another retirement option that can provide a steady stream of income during retirement. An annuity is a contract between you and an insurance company, where you make a lump-sum payment or a series of payments in exchange for regular payments in the future.

There are different types of annuities, including fixed annuities and variable annuities. Fixed annuities provide a guaranteed rate of return, similar to a traditional pension plan. On the other hand, variable annuities allow you to invest your contributions in a range of investment options, which can potentially generate higher returns but also come with more risk.


Understanding the difference between income and net worth is crucial for achieving financial stability and long-term wealth. Your financial advisor Fresno, Ca is committed to helping you understand that while income represents the money you earn on a regular basis, net worth reflects your overall financial health by considering your assets and liabilities. By tracking your income and net worth, you can make informed financial decisions, set realistic goals, and work towards achieving financial independence.

We have a strong team of professionals helping ensure you receive all the assistance you need not only in developing your retirement income strategy, but in maintaining it throughout your retirement. Contact us today at 559-230-1648 or visit us today at Soutas Financial to get your retirement plans on track for success!

Investment advisory services offered through Foundations Investment Advisors, LLC, an SEC registered investment adviser. The commentary on this website reflects the personal opinions, viewpoints, and analyses of the author, Soutas Financial, and should not be regarded as a description of advisory services provided by Foundations Investment Advisors, LLC (“Foundations”), or performance returns of any Foundations client. The views reflected in the commentary are subject to change at any time without notice. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security, or any security. Foundations manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Foundations deems reliable any statistical data or information obtained from or prepared by third party sources that is included in any commentary, but in no way guarantees its accuracy or completeness.