NAVA capitalizes on the Social Security reform debate.(COMMUNICATION)(National Association for Variable Annuities)(Brief Article

The National Association for Variable Annuities, Reston, Virginia, has seized the momentum created by the ongoing debate over proposals to reform Social Security to announce five rules for retirement planning. NAVA's "Five Retirement Rules of Thumb":

100 percent rule. Rising medical costs and more active lifestyles indicated that Americans will need close to 100 percent of their pre-retirement income in retirement.

Two thirds rule. Social Security typically provides for only one third of retirement income needs, which means that retirees need other sources of income, such as pensions and annuities, to meet their monthly income needs.

13 times rule. Retirees who want to purchase an annuity to receive guaranteed lifetime income payments need an amount equal to approximately 13 times the annual income sought in retirement.

110 rule. Greater longevity may require Americans to keep a higher percentage of retirement savings in riskier equity investments to maximize earnings. To determine the allocation of retirement investments, retirees can subtract their current age from 100 to determine their equity-investment allocation.

Rule of 72. Savings plans need to account for inflation. To determine the number of years it will take for savings to be worth half their current value at a given inflation rate, divide the inflation rate into 72.

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