Income Planning: Don’t Eat Your Seed Corn

Growing up on Maui, we drove by several acres of corn fields every day to get to school in town. I always wondered why they chose to grow corn amidst cane fields outside of Kihei. It turns out that the agricultural biotech industry, which includes seed corn research companies like the huge Monsanto Corporation, develop new varieties of corn on the Mainland in the summer and sent it to Maui for multiplication during our mild winter. That lets the seed companies bring new cultivars to market a season earlier. As a Maui boy, all I knew was that we never ate that corn. They were growing seed corn, and unbeknownst to us we were learning a valuable lesson in practical economics.

My dad once told me when I was younger that seed corn is what farmers need to plant now to get a crop to live on in the future. If you eat the seed corn today, it may be tasty and you may live well in the short-term, but you could have some major problems down the road. It’s the origin of an old country saying that’s full of wisdom: “Don’t eat your seed corn.”

The analogy applies to individuals and businesses. One of the purposes of strategic planning is to help ensure that businesses invest their capital for tomorrow. The same holds true for individuals and families, as it relates to retirement income planning. The more seeds you plant today, the better your chances will be of having enough in the future.

Some say it’s the main difference between the rich and poor in America—the ability to delay gratification in anticipation of greater rewards in the future. And because many Americans have been feeding at the trough—stuffing their faces with seed corn—now there’s nothing left.

This is where “retirement income planning” comes into play. If all you do is consume what has already been reaped from prior investments, eventually you will run out of funds. Of course, if you’re a “pensioner”—workers having traditional pension plans through their employers—this doesn’t apply to you as much. I’m directing this article toward those individuals who are relying on personal savings, IRA’s or 401(k) plans to fund their retirement.

It’s not an easy pill to swallow. After spending a career accumulating money for retirement, the idea of cashing in those investments to create income can bring on anxiety for many people. Their common fear is running out of money when they’re too old to do anything about it.

In fact, according to a new poll by Allianz Life Insurance Co. of North America, of people ages 44 to 75, more than three in five (61 percent) said they fear depleting their assets more than they fear dying.

Fortunately, there’s a financial tool that can help. To learn more about how it can boost your retirement security by transforming a portion of your savings into income that’s guaranteed for life, please feel free to contact me at

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