Going to the casino and gambling your retirement isn’t such a good idea.  But neither is stuffing your money under the mattress.  Going to either of these extremes is probably the result of an emotionally based decision.  A financial plan can help you manage the risks of investing but more so it can help you manage your emotions as well.  There are many strategies that a financial plan can offer to help you manage your retirement and many of them may be right for you.

The one that we often hear about is the single asset allocation model that begins aggressively and moves to a more conservative model as you near retirement.  The issue with having one asset allocation model that is conservative at the beginning of retirement is possibly running out of money and not keeping pace with inflation over the next 30 years of retirement.  That’s a long time to consider investing in too conservatively of a portfolio throughout your retirement.  The strategy I’m talking about here is often referred to as the bucket approach.  It’s breaking up your portfolio into sections that target various timeframes.  It’s a strategy that can help you manage your emotions during difficult economic times where the market isn’t performing as well.
Calculating when to take your social security can also have a significant long term impact on your retirement.  Waiting to take social security isn’t just a strategy to increase your monthly income but also a way to reduce your required minimum distributions.  Spending down your 401(k) or IRA earlier in retirement will reduce the amount that is required to be distributed later in life.  The more conservative the investor, the more attractive this option typically becomes.
Working longer or part-time is also a strategy that can help you to avoid investing too conservatively.  The supplemental income that you would generate from working longer may help reduce the emotional burden and fears of investing.  It’s also another strategy that you can use to possibly increase your social security if it’s one of your higher earning years.  And if your social security is reduced for earning too much, you could get it back later on from social security assuming you are still alive.
While there are risks for investing, it’s important to consider the risks of investing too conservatively.  A  financial plan can help you navigate your retirement and guide you to better understand what options are available to you.

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