The time to plan is now! See below for 5 considerations for income during retirement and how to protect your retirement income.
#1. Plan for health care costs.
Healthcare costs are exponentially increasing. Without proper budgeting or planning in this area, a retiree may be overexposed.
#2. Expect to live longer.
Life expectancy continues to go up. So longevity risk and outliving your money is becoming a concern for more people. Make sure to position your investment portfolio for enough income and growth so you don’t outlive your money.
#3. Be prepared for inflation.
Every 25 years, on average, inflation doubles the cost of living. Make sure to keep in mind that outpacing inflation is just as important as keeping money “safe.” Don’t fear growth to your portfolio more than losing purchasing power to high inflation.
#4. Position investments for growth and income.
Without any growth in a portfolio, inflation and the spending risk increases. A diversified portfolio of growth, income, and stability will help keep your principle safe, while allowing your money to continue growing reasonably.
#5. Don’t withdraw too much from accounts.
Be careful and consider the safe withdrawal rate of 3-5%. William Bengen is the financial professional who studied the 4% withdrawal rate and determined that over each 30 year period, 98% of the time a retiree will never run out of money, and less than 10% of the time will a retiree end with less principle than they started with.
Call us today! We can help ensure that your retirement portfolio is positioned prudently for the uncertainty in the election ahead, but also being mindful that we should aim to outpace inflation and add some growth.