"If you're used to bringing home an average salary, you can expect Social Security to replace about 40% of it in retirement - assuming that benefits aren't cut broadly, of course. But in that case, living on Social Security alone would mean taking about a 60% pay cut. And while you may very well see your spending decrease in retirement, it may not decrease drastically enough for Social Security alone to cut it."
"Those premiums generate steady income for the fund, which it then shares with investors in the form of monthly distributions. JEPI offers a number of benefits. In addition to a high monthly income, the fund is actively managed, which can help mitigate risk during periods of market volatility. But let's be clear. JEPI is not a low-risk investment, since S&P 500 companies are subject to wild swings. You'll need to make sure the fund aligns with your personal risk tolerance."
Social Security typically replaces about 40% of an average salary in retirement, meaning relying on it alone can equate to roughly a 60% pay cut. Retirement spending may fall, but often not enough to bridge that gap. Building a portfolio of income-generating investments is important to maintain desired lifestyle. Certain ETFs sell covered-call options to generate premium income and distribute monthly payouts. The JPMorgan Equity Premium Income ETF (JEPI) uses covered calls on S&P 500 holdings, offering high monthly income and active management while retaining market risk. The JPMorgan Nasdaq Equity Premium Income ETF (JEPQ) applies a similar covered-call approach to Nasdaq-100 stocks, which are heavily weighted to tech and growth companies.
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