At some point in your life, you’ll shift from saving for retirement to enjoying the fruits of your years of labor. But even if you’ve planned out when to stop saving for retirement, the move can be scary, especially if you’re concerned about making your savings last.

When the saving stops and the spending begins, though, there’s another option. You can stop saving, start investing, and earn a little extra income on the money you’ve saved. It’s important, though, to shift up your investment strategy to account for your new lifestyle.

Investing in Retirement Considerations

When you think of investing in retirement, you probably immediately consider the years you’re spending building a retirement savings through investments. But investing can continue well after you retire. Here are a few tips to help.

Maintain the Right Portfolio Mix

Diversification is a wise idea at any age. But in retirement, it’s more important than ever. When you’re living on Social Security payments, 401(k) payouts, and distributions from your IRAs, losing money on the stock market can put a huge damper on your retirement spending. Saving money after retirement means striking the right balance of stocks and bonds, as well as routinely rebalancing your portfolio to keep the risk level aligned with your goals.

Use Diversification Strategies

Once you’ve established that diversification is one of the best ways to invest after retirement, it’s time to decide what strategy you’ll use. Diversification isn’t just about choosing a mix of stocks and bonds, but it’s also about diversifying within each of those asset classes. Your goal should be to build a portfolio full of assets that won’t all crash or thrive at the same time. This will ensure you can counterbalance things if one section of your portfolio has a rough year.

Have Some Cash On Hand

One of the biggest concerns retirees have is, “Will I outlive my retirement savings?” This can happen, but a more pressing issue is whether you’ll have enough liquid assets to rely on when something comes up. If your home needs a new HVAC system or you have to buy a new car, having your funds tied up in stocks or CDs can be a problem. You’ll need to at least keep some of your cash available for those emergencies.

Be Disciplined About Withdrawals

Figuring out how to spend down retirement assets can be complicated. Even experts differ on how much retirement savings should be withdrawn each year. The important thing is that you have a plan. Many experts will recommend taking out a small amount of your savings each year – typically less than 5 percent. But it’s best to work with a financial expert who can look at your own finances and help you with a plan.

Have a Drawdown Strategy

If you look at a group of retired people to see how do retirees spend their money, chances are you’ll see spending habits across the spectrum. But no matter what, unless you have more income coming in than you’re spending, you’ll gradually deplete your savings. That’s why it’s important to have a solid strategy for which accounts you’ll tap out first.

Final Thoughts

Whether you’re wondering how to spend money in retirement or planning how you’ll continue to invest, it can be tough to do it on your own. There’s no one-size-fits-all strategy when it comes to retirement planning. It’s always best to sit down with a Certified Financial Planner (CFP®) to map out the best strategy for your unique situation.