DeVol Insurance & Financial Services
Fall 2017  

Welcome to My World

I grew up in a life insurance household in suburban Philadelphia, where my father and later my older brother were both in the business. My father taught insurance at Penn's Wharton School during the war and my brother went there for graduate school. I learned very early that life insurance policies are rated at "nearest birthday," in other words, at the half birthday. I was born on June 25th and I thought of myself as a Christmas baby since my half birthday is on December 25th. In my insurance-steeped world my age changes every December 25th.

Risk Management from Early On

Once as a boy I travelled to Washington DC and for the trip my father had me divide up my money: put some in my suitcase and some in my pocket. Later I learned that this is classic risk management. Then I developed my career in insurance.

Tune in to WIFM:
"What's in it for me"

The reason I'm brandishing my credentials in risk management is that I think it is time for us all to revisit our allocation. Are you over-weighted in stocks, which may be  at or near an all-time high ? Now is the time to answer that question, not later. 

Longevity Risk

Speaking of risk, I'm becoming increasingly sensitized to longevity risk -- living too long. A baby born today is expected to live to 76 if they are male and 81 if female. But, if you retire today at 65, you can expect to live to 83 if you're a man, and 85 if you're a woman. (Social Security Administration, Actuarial Life Table, August 2013). And half the population can expect to live longer than that. A 65 year old couple today has a 25% chance of one of them living to 97.  (Merrill Lynch, "Annuities for Lifetime Income, 2016. Merrill Lynch Wealth Management. IMG Retirement Strategies calculations based on Society of Actuaries, 2012 Individual Mortality Tables, Basic.)

While these predictions of long life are good news in one sense, they presents challenges to the retirement portfolio. This dilemma was brought home to me recently, when I had the opportunity to work with a couple: 95-year-old male and 84-year-old female. I had worked with this couple six years prior, when the husband was 89. The male life expectancy in my software at the time defaulted to 92, so I planned on him living to 95. For this round of planning I just pushed their life expectancies both out to 100. What else could I do?

I Continue to Learn from My Clients

Another client, who is single, came in, eager to retire at 64, but wanting to be certain it was safe to do so. They conscientiously pointed out that when totaling their expenses they should plan for a new car every 10 years. In finance this is called a sinking fund.

Here's a simple example for a homeowner.

Sinking Fund: 
Annual Cost
every 20 years
every 10 years
every 10 years


The $3,100 should be added to the anticipated annual retirement expenses in this case. You might want to add other items: Home renovations? Travel? Education? 

Thomas Phelps DeVol is the founder of DeVol Insurance & Financial Services. He enjoys helping people transform their hopes about the future into attainable retirement plans. His persistence, know-how and diligence are the keys to his success -- and that of his clients.

Tom has three children and lives with his wife, Connie, and their youngest children in Newton, Massachusetts. He enjoys gardening, tennis, jogging and opera.

Tom can be reached at 617-964-6404 or via  email .
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Securities offered through Parkland Securities, LLC. Member FINRA/SIPC. Investment advisory services offered through Sigma Planning Corporation, a registered investment advisor. DeVol Insurance & Financial Services is independent of Parkland Securities, LLC and SPC.

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