6 Tips How To Outlive Your Retirement Income

Retirement income

6 Ways To Make Your Money Last

You Only Have 3 Retirement Goals

  1. Preserve your retirement investments, so your money lasts as long as you do.
  2. Find a way to have your retirement income outpace inflation.
  3. Enjoy your retirement.

Historically stocks have outpaced inflation, but the volatility of stocks can make them an inappropriate investment vehicle when you are relying completely on your retirement investments as your sole source of income.  Therefore, you may be wise to limit the number of stocks in your portfolio or  use a blend of dividend paying stocks and bonds.

Capital preservation can be tough when the market meltdown never seems to end.   The best way to do it and make your money last longer is by the order in which you withdraw your money from your investments.

You will enjoy your retirement much more if you do not have to worry about your finances.

Organizing Your Retirement Withdrawals

  • Tip #1 – Dividends & Interest

Delay dipping into your investments and save on taxes by supplementing your retirement income with dividend and interest paying investments.  Dividend paying stocks and interest paying bonds will also lower the risk of your portfolio.

  • Tip #2 – Non-Retirement Accounts

Tap into those investments sitting in non-retirement accounts. You can take tax deductions for any capital losses you may realize from the sale of assets in a non-retirement account.

  • Retirement income
    courtesy of learnvest

    Tip #3 – Retirement Plans

Next, withdraw from your retirement plan accounts.  These will be your traditional Individual Retirement Accounts, 401k retirement plans and 403b retirement accounts.   This money has never been taxed, so it will be taxed as ordinary income.

  • Tip #4 – Roth IRA’s

Withdraw from your Roth Individual Retirement Accounts.  Unlike a traditional IRA, money withdrawn from a Roth is not taxed at retirement.

  • Tip #5 – Social Security

Unless you have health problems and are forced to rely upon social security benefits, delay using your social security benefits as long as you can.  Social security benefits will keep up with inflation.

  • Tip #6 – Annuities

Buy an annuity.   Annuities work for some investors but not for others. Many investors are afraid of annuities because they are unfamiliar with them.

Do your homework before investing in something you do not understand.  You will find that annuities provide you a guaranteed stream of income, sometimes for the rest of your life.   Plus, they are one of the few investments that can outpace inflation.

Your Work Is Never Done

Successful investing takes work.   And once you’ve accumulated enough money to afford retirement your job is not over.   Once in retirement you have to continue to work on your investments.


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