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Practical Strategies for Retirement Income

Before you retire, you have to know how to make do with and maximize what you already have. Financial consultants in 07663 can help you develop retirement income strategies that allow you to create predictable retirement income out of what you have today.

Practical Retirement Income Strategies You Should Know

Formulate a Bucket Approach

Creating buckets or the time segmentation strategy involves the establishment of various accounts for different kinds of spending in specific time periods. For example, the money that’s required to meet your short-term needs should be held in cash while the money you need a long time from today should be invested in opportunities that offer higher risk and higher return.

Separate Your Needs from Your Wants

Sometimes called Essential vs Discretionary, this strategy seeks to identify your basic needs and calculate how much money you need on a monthly basis. The ultimate goal is to come up with a detailed budget for the rest of your life.

Systemic Withdrawals

This popular retirement income strategy involves taking your investment portfolio and selling off a fixed withdrawal amount every ear so that you can generate your retirement income. While you’re at it, you may also play around with various fixed percentage withdrawal rates.

Build Guard Rails

To come up with a flexible withdrawal strategy, you’ll have to build guard rails by starting out with a balanced 60/40 portfolio with an initial withdrawal rate of 5%. If you had a positive return for the prior year, you’ll have to draw down your portfolio each year by a figure that’s close to the existing inflation rate. Your withdrawal rate should be calculate each year.

Maximize Your Social Security

Boost your lifetime retirement income by delaying the start of your Social Security. If you start Social Security at age 62, you’ll have a significantly lower monthly retirement income than if you wait to start until your maximum retirement age.

Assess Your Risk Tolerance and Needs

Your retirement income plans should be tailored to how much risk you’re willing to take and how much income you may require. Discuss your needs with a financial advisor so that they can help you create a draw-down strategy that’s specific to your risk tolerance and needs.

Where to Find Reliable Financial Consultants in 07663

At 1879 Advisors, we want you to reach your desired effective retirement income. Call us now to schedule your appointment.

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