Are you using non-correlated income wisely? On this episode, David explains what non-correlated income is and how you should use it within your financial plan.
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You might think non-correlated income is a fancy term, but it might be something you already have. What is non-correlated income? How does it fit in your financial plan?
Non-correlated income is income that has nothing to do with the stock market. With your correlated income, you want to consider the four percent rule to take out each year in retirement. With non-correlated income, you are able to be less concerned about the market.
When you are working, you have non-correlated income through your wages. In retirement, this may be your pension, income from a rental property, or from an annuity.
If you are retired, how much of your income should come from non-correlated income? One good way to think of it is by having your needs met by your non-correlated income and your wants by correlated income. That way you can cover the basics and not be dependent on the stock market.
David shares client examples of people who have leveraged their non-correlated income to work well in their financial plan. How is non-correlated income currently at play in your plan? Are you relying on correlated income too heavily?
Listen to the full episode or click on the timestamps below to hear more about non-correlated income.
[0:22] – What is non-correlated income?
[1:33] – Why is non-correlated income important?
[2:45] – What are some examples of non-correlated income?
[3:43] – How much of a retiree’s income should be non-correlated?
[5:02] – What’s an example of someone who used non-correlated income to add stability to their retirement?
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