A New Study Shows How Different Generations Perceive Aging
July Half-Price Sale on eBooks for Boomers!

5 Ways to "Spend Safely in Retirement"

Pexels-magda-ehlers-1329292Have you heard of the "Spend Safely in Retirement" strategy? It is a research-based approach developed by the Stanford Center on Longevity in collaboration with the Society of Actuaries to give the highest number of retirees the biggest amount of income possible that would last their lifetimes.

According to Stanford researchers:

"The spend safely in retirement strategy is designed to help middle income workers and retirees decide when to retire, how much to spend in retirement, and how to best deploy your financial resources. The main goal of the strategy is to help you turn your assets – Social Security, the ability to work, savings, and home equity – into the most retirement income possible."

These are the five components of the Spend Safely in Retirement strategy:

  1. Delay Social Security
    "Maximizing the value of this benefit means waiting to start until at least your full retirement date. The longer you wait to start Social Security, the greater your monthly benefit will be."
  2. Plan Your Withdrawals from Savings
    "The Stanford researchers recommend that your retirement savings be invested in low-cost mutual funds, target date funds, or index funds. And then, use the required minimum distribution (RMD) formula to determine your annual withdrawals from these savings."
  3. Get Detailed with Projected Expenses
    "You need to see if the income from the above sources – as well as a pension if you are lucky enough to have one – is adequate to cover all of your projected expenses. The more accurate you can be with projecting your expenses, the more reliable your plan will be."
  4. Explore Other Sources of Income to Fill Shortfalls
    "The spend safely in retirement strategy recommends you consider delaying retirement, reducing expenses, getting a retirement job, and/or tapping your home equity to fill in the gaps."
  5. Explore More Sophisticated Withdrawal Strategies if You Have a Lot of Savings
    You could consider "annuities, a bucket approach, varying your withdrawal amounts based on investment returns (applying floors and guardrails), setting up a bond ladder, or establishing a more sophisticated allocation for your assets."

You can read more about this plan here.

Photo by Magda Ehlers: https://www.pexels.com/photo/numbers-wall-decor-1329292/

HappilyRewired.com is a Wearever Top 20 Senior Blog and a Top 75 Baby Boomer Blog

Mockup2

 

Discover How World War II Helped Launch "Boomer Brands"

Comments

Feed You can follow this conversation by subscribing to the comment feed for this post.

Verify your Comment

Previewing your Comment

This is only a preview. Your comment has not yet been posted.

Working...
Your comment could not be posted. Error type:
Your comment has been saved. Comments are moderated and will not appear until approved by the author. Post another comment

The letters and numbers you entered did not match the image. Please try again.

As a final step before posting your comment, enter the letters and numbers you see in the image below. This prevents automated programs from posting comments.

Having trouble reading this image? View an alternate.

Working...

Post a comment

Comments are moderated, and will not appear until the author has approved them.

Your Information

(Name and email address are required. Email address will not be displayed with the comment.)