Smart Management of Retirement Income

  • Introduction

Introduction

 

When you retire, you have more control over your time, and finally have enough leisure to do what you want. While taking control of your time may not require a lot of advance planning, taking control of your retirement finances does.

 

You need income you can count on, year in and year out for a very long time. This resource will help you manage your retirement income wisely.

 

Getting Ready for Retirement

Whether your retirement is fast approaching or years away, there are actions you can take now to maximize retirement when the time comes. It’s never too early or too late to start.

 

Sources of Retirement Income

Managing retirement income starts with knowing what your sources of income will be—from Social Security to an employer-sponsored retirement savings account like a 401(k)—and the rules that govern each income source.

 

Selecting Payout Methods

When you retire, you begin to take income from your defined benefit pension or defined contribution plan. You may also take income from a Social Security account. You should learn about the payout options from each source and what each means for your personal situation.

 

Managing Investment Portfolios

Retirement income management is all about making sure your retirement savings provide enough income for your needs, and that you don’t outlive your assets. This starts with setting up and managing a portfolio that's right for you.

 

Taxation of Retirement Income

When you retire, you leave behind many things—the daily grind, commuting, maybe your old home—but one thing you keep is a tax bill. In fact, income taxes can be your single largest expense in retirement.

 

Working in Retirement

You're retired, but you may want to go back to work. You should, however, understand exactly how working after retirement might affect your Social Security, pension benefits, and other retirement income.

 

Long-Term Planning

Once retired, you may have questions about the future—particularly about how your spouse and family will cope financially if you become disabled or die and what will happen to the assets in your estate after your death. These valid concerns underscore the importance of solid long-term planning.

 

Health Care Costs

Your plans for the future shouldn't just be about what happens to your property or financial affairs. The longer you live in retirement, the greater the likelihood that you will need to use health insurance or arrange for long-term care.

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    Getting Ready for Retirement