Here are three approaches to generating the desired amount of retirement income. When deciding which option – or combination of options – is right for you, we’d encourage you to seek the help of a financial advisor.
1) Get the Most Out of Your Social Security Retirement Benefits
There are several strategies to consider when trying to optimize how you activate your social security retirement benefits. We’ve written about two methods in particular that may help you increase the size of your Social Security check, if executed correctly. The first is the Restricted Application for Spousal Benefits, and the other is the File and Suspend Strategy.
2) Dividend Paying Stocks
A portfolio constructed of stocks that pay dividends means the potential for accumulating cash, which you can then pay out to yourself as income periodically. There are several money manager strategies that focus on dividend paying stocks, which you can learn more about here.
3) Fixed Income Allocation Bonds
Bonds will usually pay a coupon and/or interest payments at set intervals. Another strategy involves purchasing bonds with varying maturities. This way you can stagger the income payments and the principal you receive when the bond matures. Your fixed income strategy than owning equities in your portfolio, but there may be less upside potential over time.
Design a Retirement Income Strategy with Your Financial Advisor
Your retirement income strategy should take into account a number of factors, including your current and future income sources (Social Security, pensions, etc…), your level of comfort with risk, your age, your spouse’s age, and most importantly, your expected income needs in retirement.
Figuring out which retirement income strategy – or combination of strategies – is right for you can be a complex process. A financial advisor should be able to help you develop an appropriate retirement income strategy relative to these factors.
If you’d like to speak with a financial advisor about how you plan to generate income in retirement, please give one of our Wealth Managers a call at 1-800-541-7774.
