There are many different retirement income strategies but three of them are more commonly used that the others. The most popular strategy is the systematic withdrawal strategy which is when a person takes out a specific amount from their fund at the end of the year and increases that amount each year. The flooring retirement strategy is based off your spending goals as well as your wants and needs financially. Finally the time segmentation strategy involves the bucket approach which divides your retirement fund into different buckets which are used for specific things such as an emergency fund and/or long-term investing.
Key Takeaways:
- The Systematic Withdrawal Strategy is the most common and it takes an investment portfolio and sells off all the investments at the end of the year.
- A flooring retirement strategy prioritizes spending goals and the biggest challenge with it is separating your financial needs and wants.
- The time segmentation strategy involves you putting your money into different investment buckets that will pay off in the short term as well as the long term.
“The shift places the savings, investing and income generation burdens onto the individual.”
Leave a Reply