Looking ahead to retirement often means that you are looking forward to disconnecting from work. However, you’ll still need some form of income in your retirement years. Knowing where your money will come from every single month will give you a great opportunity to reduce the peace and friction for yourself which can lead some who have not planned properly to have to go back into the workplace for a part time job.
Since you are in effect creating your own paycheck in your retirement years, you need to think carefully about these important questions in the years prior to approaching retirement. A few different income streams is the ideal situation for a person approaching retirement. These income streams can include investment savings, pensions or social security or some combination of all three. You might be counting on a Roth IRA, rental income, or other income paying assets but it might be time to move to a more conservative portfolio structured to protect those interests as you enter retirement.
A pension plan is likely one that has already been structured and clearly explained to you in terms of payout as you get closer to your retirement years. You could be offered a lump sum payout at some point but you want to carefully weigh whether or not it’s in your best interests to take a monthly or annual payout instead. Finally, there are plenty of different filing strategies to consider when it comes to claiming social security benefits.
You’ll need to understand which ones are most beneficial for you based on your individual situation. Make sure that you have a financial professional who can guide you through the selection process. Need help with more questions around the elder law planning and estate planning? We’re here to help you see how these connect.