The economy is top of mind for most Americans today. But if you are nearing or already in retirement, you may have extra concerns about running out of money. Have you saved enough? Are you spending more than you expected to? TheWeek.com has compiled some tips to help you keep your retirement secure:
Reassess how much retirement income you really need
Whether you are still in the planning phase or have already retired, it is never too late to take a second look at your retirement budget (or make one, if you have not already)…
Determine how much you actually need to withdraw each month to cover necessary expenses while keeping a lid on other spending, without draining your savings too quickly. Keep an eye out for any debt balances that start growing…
If your debt is growing, figure out how you can adjust accordingly, whether by cutting back or finding an additional source of income.
Reinvest some of your funds
Even though "the rule of thumb is often to shift your assets to an 80/20 mix between safe investments, like bonds and growth investments, like an equity index fund" as you near retirement, what experts "do not recommend is that you take your money out of the market entirely," said SmartAsset.
If concerns about running low on money are cropping up, consider reinvesting some of your funds to try to capture potential returns. Just make sure to be measured about any risks you end up taking — otherwise, you could end up in an even worse situation…
Be strategic about tapping Social Security and retirement accounts
Another way to secure some more retirement income for yourself is to hold off on taking Social Security. While "you're entitled to your complete Social Security benefit, based on your personal wage history, once you reach full retirement age," you can "give your monthly benefit a boost of 8% per year if you hold off on claiming it, up until age 70," said The Motley Fool.
Tapping other retirement accounts should involve some careful consideration, too. As it turns out, "tapping your IRA or 401(k) whenever you want money could put you at risk of depleting those funds sooner than expected, so rather than take your withdrawals at random, have a plan" for when you'll make withdrawals and how much you'll take out.
Consider some part-time work
While many people associate retirement with the end of their working days, sometimes income needs stipulate otherwise. "As much as you may dread this, it's important that you remember that work in retirement can be redefined," said USA Today — now, "you only need to work enough to supplement the other income sources that you have."
This can mean doing a role that is radically different from what you did throughout your career, or a little more of the same, depending on what you prefer. For example, "seniors could pursue traditional part-time jobs or work as a consultant in their former field," or they may consider "renting rooms out or finding a position within the emerging sharing economy," said U.S. News & World Report.
You can read the full article here.
There are certain steps you can take to help insulate your finances, and your future, from the impact of inflation, and other unforeseen circumstances. In truth, retirement is not unlike any other period of your financial life. You need discipline, knowledge, and flexibility to maintain your financial health.