Budgeting for retirement is not a simple matter. It's time-consuming and tedious, but the rewards can be substantial. To help you get started, here are three common methods to arrive at a budget to ensure a desired retirement lifestyle and financial security.
The stock market doesn't owe your retirement anything. That may come as a surprise to some. As recent market events have demonstrated, an income strategy that relies upon market growth to fund spending during retirement can be a recipe for disaster. Market fluctuations, especially during the pivotal early years of retirement, can decimate savings and imperil future spending.
For many women, retirement security is challenging. Some significant obstacles women face include earning less than men, spending less time in the workforce, having considerable caregiver responsibilities, bearing more burdensome financial consequences from divorce, and living longer lives than men.
Once you decide the best ways to source spending in retirement, develop a strategy for claiming Social Security benefits, determine how to make decisions for healthcare and long-term care needs, and manage future tax liabilities in the retirement income plan, there are still several things you must consider.
Relying on the stock market to fund retirement can be risky. Retirees who depend on market returns to generate income face the potential loss of savings and spending ability should they experience poor market returns during the critical early years of retirement while spending from their portfolios.
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