You have saved diligently during your working years and now you are ready to retire. Your supplemental retirement plan accumulation should be considered as the flexible part of your retirement income which includes the Master Retirement Plan and Social Security. What actions should you take with your savings accumulation to maximize the benefits from it in retirement?

Information is critical for you in making decisions that will ensure adequate income and flexibility for desired activities or purchases. Your best sources for information regarding your employer-offered plans are the BYU Benefits Office, DMBA, or TIAA-CREF. Make an informed choice.

Financial Challenges in retirement will include:

• Number of years that income will be needed. We are living longer. Life expectancy at age 65 is 19.6 years for men and 22.1 years for women. Half of the population will live longer.
• Inflation — The costs of goods and services led by healthcare costs, will likely double during retirement.
• Government-required Minimum Distribution — By April 1st of the year after reaching age 70½, you will be required to withdraw a specified amount from your tax-deferred funds each year and pay the taxes on it (age 75 for TIAA-CREF funds deferred prior to 1986). This reduces your savings accumulation and disrupts your investment process.

Investment Objectives will be driven by your own financial plan.

• Security — You may select options to protect savings that will provide needed income.
• Flexibility — You may avoid options that lock in fixed payout rates.
• Inflation Protection — You may keep funds earning interest to offset inflation.

Options with DMBA/TIAA-CREF Savings Accumulation at retirement include:

• Status Quo — Let funds continue to earn interest. Structure investments to protect accumulated funds while earning interest to offset inflation.
• Turn investment over to a financial planner - You will likely pay management fees as well as load charges if you roll your money to other accounts.
• Consider continuing to manage your own money.
• Withdrawals — These need to be planned to minimize taxation. Twenty percent will be withheld for taxes. Be sure to check on any plan withdrawal restrictions. For example, DMBA withdrawals can be made once every three months.
• Systematic Withdrawals — TIAA-CREF has an option that will allow you to set up a regular withdrawal (monthly, quarterly).
• Interest-only Income Options — Receive only the interest earned from the TIAA Retirement Annuity, DMBA TSA Plan, and/or DMBA Thrift Plan. This option protects the principal; however, it may only be continued until age 70½.
• Annuity Income — This provides a monthly income based on life expectancy with single-life or two-life options. Annuity income is a good option if your objective is security.
• Fixed Interest — This option will pay out all or a portion of your savings accumulation at a specific rate over a fixed number of years.
• Minimum Distribution — Beginning at age 70½ you can arrange to have TIAA-CREF payout in December of each year the amount of your tax-deferred savings necessary to meet the government-required minimum distribution. Twenty percent will be withheld for taxes.
• Flexible Distribution — DMBA will divide your account into monthly payments over a fixed number of years. You may make withdrawals or close the account at any time.