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Retirement Income
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Retirement Income planning involves optimizing various income streams:

  • Social Security
  • Pension benefits
  • Annuities
  • Wages
  • Portfolio withdrawals
  • Rental Income
  • Home equity

Social Security is the most important retirement asset for most of usContrary to popular belief, Social Security is not likely to go awayThe most significant decision you can make to ensure you don't outlive your assets is to optimize your benefits You are rewarded with an 8% higher benefit for each year you delay beyond normal retirement age up to age 70. Since Social Security provides an annual cost of living adjustment… That COLA is calculated on the higher base; compounding the impact of the delay.   Maximize your Social Security benefits

Pension benefits still exist for some of us. Along with Social Security, pensions provide an important floor of financial security in retirement. Many do not have an adjustment for inflation, making retirees vulnerable to price increases later in retirement. A reduced benefit is usually made to a surviving spouse… since two live nearly as cheaply as one, a premature death can result in financial insecurity.  Pension vs. Lump Sum



NOTE:  The Pension Benefit Guaranty Corporation can help you find information on lost pension benefits.

Like pensions, annuities provide an income stream that cannot be outlived. An early death could leave a survivor vulnerable. Someone without a pension may want to purchase an immediate annuity to secure an additional stream of income for life.

Many of us will be working in retirement. Even small part-time earnings can go a long way to improve financial security in retirement.

A 4% rate of withdrawal is considered to be a sustainable rate of withdrawal in retirement. (At 3% it is almost fool proof that you will not outlive your assets.) From this base amount you can add a 3% increase to account for changes in the cost of living with reasonable expectation that your assets will last for 30 years. At this level, someone with $1,000,000 in investments can withdraw $40,000 in year one and $41,200 in year two.

Those with real estate portfolios may have rental income to supplement their income in retirement.  Aging will eventually make managing properties a challenge, so consider scenarios where you sell these assets.

Home equity  will be used by many Americans strapped for cash in retirement. We want your home paid off at or near retirement and prefer not to include this resource in determining whether or not you can afford to retire. Tap into home equity only as an Emergency Fund of last resort.


Click here to determine if you can afford to retire and learn how to optimize your streams of income in Retirement.

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