Once you understand how your Social Security benefits are taxed, you can begin exploring opportunities to potentially reduce the taxes you pay. Depending on your income and mix of assets, you may have the ability to better manage your tax liability in retirement.
As with most things in retirement income planning, there is no universal best approach for taking withdrawals. Your specific circumstances should determine which approach you take and should be reassessed if/when your plans change. Having assets in all three types of accounts can prove to be a useful tool in retirement.
The WRAP process can be useful when making decisions when planning for retirement. While you can still have bad outcomes, the focus is placed on the analysis rather than the results.
Developing and adhering to a sound investment strategy is essential in retirement. This strategy will likely look different than the one you used during your accumulation years. You must find a balance between today’s spending needs and those of the future if you plan on maintaining your standard of living throughout retirement.
Inflation is yet another risk you may face in retirement, though its effects may not be felt for many years. With smart planning and prudent investing, there are ways to attempt to mitigate its effects on your purchasing power.
Retirees today have access to more free information and resources than ever before. The issue now is not access but rather the accuracy of the information and mistakes can be costly. Understanding the information and actually implementing the recommendations from that information are two different skills.
Putting your investing on autopilot is often a useful strategy when you are accumulating assets, but as you approach retirement, your portfolio could likely benefit from regular monitoring and these adjustments.
The Rule of 25 is far from perfect, but it can be a good way to get a rough figure on the size of the nest egg you will need for retirement.
These items may not be appealing but can be beneficial when incorporated into your retirement plan. Even if you decide against using these strategies it would be prudent to explore their potential benefits.
The thought of investing in the stock market can seem intimidating but following a systematic process to begin or resume investing in the stock market can be a useful way to increase your equity exposure over time. The stock market exposes you to additional risks but when these risks are managed appropriately, it can provide you a greater chance of funding your long-term goals.